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Passion the key motivation for UHNWIs investing in luxury assets

17 April 2017

Malaysia, 13 April 2017 – The world’s ultra-high-net-worth individuals (UHNWIs) are more likely to be motivated by personal enjoyment than any other factor, when making investments on luxury assets such as such as art, wine or classic cars. 

Based on the views of the world’s leading private bankers and wealth advisors, Knight Frank’s latest annual Attitudes Survey sheds light on the outlook for the world’s UHNWIs – those with $30m in assets or more.

Respondents listed ‘personal enjoyment’ as the main reason their clients acquiring luxury assets, investing for ‘status’ and ‘finding a safe haven for capital’ next most popular reasons for luxury asset ownership.   

Data from the latest edition of The Wealth Report also revealed: 

  • UHNWIs from the United Arab Emirates are most likely to own a motor or sailing yacht
  • Private jet ownership is more prevalent amongst UHNWIs from Saudi Arabia
  • UHNWIs from the United Arab Emirates are most likely to own a race horse as part of their luxury asset portfolio

Dominic Heaton-Watson, International Project Marketing, Knight Frank Malaysia, comments, “The Wealth Report is an incredibly valuable tool for Knight Frank and our clients. It positions us as the HWNI expert and gives us a genuine insight into wealth attitudes, distribution and the reasons behind the appetite for certain assets other than prime global real estate. This year’s report also delves into our most glamourous index – Knight Frank Luxury Investment Index (KFLII) – a fascinating read in which we saw wine emerging top on the index, overtaking classic cars – well ahead of art, watches and Chinese ceramics.”

Andrew Shirley, Editor of The Wealth Report, Knight Frank, says, “Personal enjoyment was considered the number one reason why UHNWIs collect and buy luxury assets, according to the respondents who took part in The Wealth Report Attitudes Survey this year. Often that pleasure is clearly connected to one of our senses – the taste of a great bottle of Bordeaux, the visual beauty of a Van Gogh, the sound of a gurgling V8 or rasping V12 engine – but sometimes it’s more to do with our bank balance or our ego.

“Some of these objects of desire also turn out to be shrewd investments so it’s no surprise then that ‘capital appreciation’ is now the second-most-important motivating factor when making a purchase – although many people still find it hard to understand the rationale for buying wine when you have no intention of drinking it.”

Although ‘personal enjoyment’, ‘status’ and ‘finding a safe haven for capital’ remain the most popular reasons for luxury asset ownership, the chance to become part of a community of like-minded collectors is a growing attraction for UHNWIs.

David Tydeman, CEO of Oyster Yachts, explains that buying into a sense of community is an important factor for many of the firm’s clients: “We may organise the Oyster World Rally, but with all the friendships found in this exclusive adventure, truly it belongs to the participants. Becoming one of the select few to circumnavigate the globe, particularly in the company of others sailing the same class boat, creates a unique bond. There is a lot of social mixing going on. People leave their egos behind.” 

 

Source: The Wealth Report 2017 (Pg 64)

 

Ends

 

To download the report, please visit:
http://www.knightfrank.com/wealthreport

 

For further information, please contact:

Mr Nicholas Holt, Asia-Pacific Head of Research

nicholas.holt@asia.knightfrank.com +86 10 6113 8030 @nholtKF

 

Ms Rachel Loke, Asia-Pacific Head of Marketing, Communications & Digital

rachel.loke@asia.knightfrank.com +65 6429 3587 @knightfrank

 

 

Ms Denise Nah, Asia-Pacific Public Relations & Communications Manager

denise.nah@asia.knightfrank.com +65 6429 3599 @knightfrank

 

Ms Seline Soo, Marketing & Communications Manager, Knight Frank Malaysia

seline.soo@my.knightfrank.com +603 2289 9669 @KnightFrank_my

 

Notes to editors

Knight Frank LLP is the leading independent global property consultancy. Headquartered in London, Knight Frank has more than 14,000 people operating from 413 offices across 60 countries. The Group advises clients ranging from individual owners and buyers to major developers, investors and corporate tenants. For further information about the Company, please visit knightfrank.com.