India’s ultra rich club to grow the fastest at 50% by 2028: Knight Frank

Bengaluru: India will witness the highest growth globally in the number of ultra high net worth individuals (UHNWI) at 50.1% in the next five years to take the tally to 19,908 by 2028, a new report by property consultancy Knight Frank revealed on Wednesday. UHNWIs are defined as individuals with a net worth of $30 million and above. 

“A range of factors will combine to propel India’s ultra wealthy population over the next five years. Robust economic growth, favourable demography and a thriving startup ecosystem will enable increased wealth creation opportunities for Indians going forward,” Vivek Rathi, who heads research at Knight Frank India, said.

Following a dip in 2022, this number grew 6.1% in 2023 to 13,263 driven by rising prosperity in India. Globally, the number of UHNWIs rose by 4.2% during the year to 6,26,619 from 6,01,300 a year earlier.

How the ultra rich spend

About 32% of the wealth of India’s ultra rich is invested in residential real estate, 14% of which is located outside the country. About 12% plan to purchase a new home in 2024. On an average an Indian UHNWI owns 2.57 homes, while a sizable 28% of the group rented out their second homes during 2023.

About 17% of their wealth is channeled towards passion investment, the top three items in which comprise luxury watches, art and jewellery. Globally, art emerged as the best performing luxury asset class with prices appreciating 11% in 2023.

“The demand for rare collectibles is on the rise across different age groups in India, and as wealth continues to grow in the country, we can anticipate further investments in these asset classes,” Knight Frank India Chairman and Managing Director Shishir Baijal said.

Of the 100 luxury residential markets tracked in the consultant’s Prime International Residential Index, Mumbai jumped 29 spots in 2023 to bag the 8th position while Delhi and Bengaluru ranked 37th and 59th, respectively. Manila led the rankings while Dubai, last year’s frontrunner slipped one spot. The growth in prices of the top 5% of each city’s residential portfolio, by market value, was considered for exercise.

“The outlook for 2024 remains bright as Mumbai with a 5.5% prime price growth forecast, ranks second among the 25 cities globally,” the report said.

Monaco retained its position as the world’s most expensive real estate market where $1 million fetched 16 square metre of space, followed by Hong Kong (22 sq mt) and Singapore (32 sq mt) in 2023. At home, Mumbai offered 103 sq mt against the same sum.