Wealth-X Report: Homes as Opportunity Gateways

The latest Wealth-X and Sotheby’s International Realty report has been released, this time focusing on the increase in ultra high net worth (UHNW) individuals that view homes as “opportunity gateways.” Its findings provide insight into the trends driving the buying decisions of these people around the world, their motivations and destinations of interest. The report, which is the third of four custom reports planned for 2015, takes an in-depth look at several specific locations including Sydney and Vancouver for buyers seeking a safe investment, and Malta, the Bahamas and Sao Paulo, destinations which appeal more to wealthy buyers looking for citizenship or residency through property investment. Direct feedback from our brand affiliates in each market is provided regarding these two discovered trends that are fueling the rise in sales of luxury homes.

Wealth-X Report-Aug 2015

The UHNW Residential Real Estate Index reveals that there has been a recent rise in luxury real estate, with Wealth-X tracking a 115.2 rise for Q2 in 2015 and an 8.3% rise year-on-year, making this the sixth consecutive quarter in which this index has increased. This reflects home buyers’ confidence in making luxury residential investments. To calculate the index, the full range of luxury residential properties that are owned by the world’s wealthiest individuals are taken into account.

According to the most recent Wealth-X report, 12% of second homes purchased by UHNW individuals are located outside of their home country.   Due to recent market fluctuations in emerging nations, a new generation of investors are considering luxury residential real estate in Western markets, with the third largest share of foreign UHNW homeowners being from China, followed by Canada and the United Kingdom. Willingness to invest in these markets is driven by the fact that 20 nations in Europe and the Americas now offer citizenship or residency programs to those who own domestically. Sao Paulo, Malta and the Bahamas are three markets that offer such programs, making buying residential real estate here a good long-term investment with many opportunities.

Wealth-X President David Friedman commented: “Wealth-X is pleased to partner with the Sotheby’s International Realty brand for this third luxury real estate report for 2015. This new joint study explores the trends and home-buying motivations of a distinct group of ultra wealthy individuals in the emerging markets. As their wealth grows, so will their investment fueled by various motivations, be it to diversify their portfolio or to gain citizenship or residency in a foreign country.”

According to Philip White, president and chief executive officer of Sotheby’s International Realty, this joint report delves deeply and effectively into the forces behind the buying decisions of ultra wealthy individuals all around the world. “The research reveals trends that go beyond traditional motivations and help guide real estate investments that contribute to long-term wealth,” he said. “It underscores the important role real estate plays in a larger strategy to build a valuable asset portfolio.”

To view the report, you can download it by clicking here.

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