‘Kenya’s super rich prefer to buy new homes’ - Knight Frank wealth report

The global ultra-high net worth population is set to increase by 22 percent over the next five years, with an additional 43,000 individuals expected to be worth more than $30 million by 2023, according to the latest Knight Frank Wealth Report 2019. Andrew Shirley, the report's editor at Knight Frank, joined CNBC Africa to delve into the key findings and trends shaping the world of wealth. Shirley highlighted the vibrant entrepreneurial spirit driving wealth creation across the globe, with regions like Asia, despite a slight slowdown in Chinese GDP growth, seeing a surge in wealth accumulation. Moreover, mature markets in North America and Europe continue to witness the creation of wealth as consumer preferences evolve, fostering new business opportunities and driving personal wealth growth. The report indicates that the increasing number of wealthy individuals globally is fueling demand for luxury homes, with Nairobi emerging as a hotspot for real estate investment. However, despite the allure of overseas real estate investments, many high net worth Kenyans exhibit a preference for investing in local properties, underscoring their confidence in the Kenyan economy. While real estate developers in Kenya are delivering a significant number of properties, leading to a slight reduction in prime property values in Nairobi, the market remains robust with substantial opportunities for investment. Despite a slight slowdown in economic growth in Kenya, prime property values have only depreciated by approximately five percent over the past year, showcasing the resilience of the real estate sector. Investments in luxury properties are also on the rise, albeit accounting for a smaller portion of high net worth individuals' portfolios at around 5%. When it comes to investment preferences, property and equities remain key components of high net worth Kenyans' portfolios, with luxury investments gradually gaining traction. Looking ahead, the report suggests that investors should focus on assets they understand well to make informed decisions. In Africa, there is increasing demand for student housing and retirement properties, presenting lucrative investment opportunities for those looking to diversify their portfolios in the continent. As more investors seek to explore the potential of the African market, understanding the diverse landscape and tailor-fitting investments to specific regions will be crucial for maximizing returns.