Australia’s ultra-wealthy population projected to rise 29 per cent: Knight Frank

The number of ultra-wealthy people in Australia is expected to rise by 29 per cent over the next five years, equivalent to an extra 1,085 people, according to Knight Frank’s Wealth Report 2020.

The data shows Australia’s ultra-high-net-worth-individual (UHNWI) population will rise to 4,881 by 2024, up from 3,796 in 2019, with more than 200 new ultra-wealthy people being created in Australia each year.

Australia’s ultra-wealthy population grew by 5 per cent in 2019 and by 35 per cent over the past five years.

At the same time, Australia’s high-net-worth-individuals (HNWI**) are expected to grow by 34 per cent over the next five years to reach close to 2.1 million. Currently, 50 million people globally are considered millionaires, with wealth of  US$1 million or more.

According to Michelle Ciesielski, Knight Frank’s head of residential research, Australia is forecast to have one of the highest rates of growth in UHNWI populations globally over the next five years.

“Australia is ranked equal 15th with Canada for the projected growth in UHNWIs out of 43 countries globally,” she said. 

“Our projections are based on The Knight Frank Wealth Sizing Model which allows us to project the number of individuals in each wealth band in the future. We have utilised data including forecast growth in GDP, house prices, equity performance, interest rates and other assets that individuals hold. 

“Coming off a number of years of solid growth in Australia, 2019 saw further wealth creation off the back of a resilient stock market and further capital gains in the prime property market. 

“Although challenges in the local economy persist, there has been much more certainty and solidifying of the global economy coming into 2020.”

Knight Frank’s Joint National Head of Private Office Sarah Harding said, “On average 80 per cent of Australian UHNWIs saw an increase in wealth in 2019, well above the global average response of 63 per cent in the Knight Frank Attitudes Survey.

“Looking ahead to 2020, 63 per cent of Australian UHNWIs believe their wealth portfolios will continue to grow, which is optimistic when compared to the global average of 55 per cent.

“Australian UHNWIs cite the top three issues challenging wealth creation in 2020 as being the flow on from the global economic slowdown, negative interest rates or bond returns and the global trade wars. 

“As a result, 92 per cent of Australian ultra-wealthy population are making changes to protect their wealth.” 

According to Ms Ciesielski, “The number of ultra-wealthy people around the world is predicted to grow by 27 per cent over the next five years, with the population rising by 136,087 to just under 650,000. An additional 31,000 UNHWI were created in 2019, an increase of 6.1 per cent. 

“Out of the top 20 fastest growing countries presented in the report, six are located in Asia, with India forecast to have the highest growth of 73 per cent.

“We expect Asia will be the world’s second largest wealth hub by 2024, with a forecast five-year growth of 44 per cent, but it will still be only half the size of North America’s ultra-wealthy population, which is forecast to increase by 22 per cent.”