International Private Capital Survey 2013/2014
Financial drivers of global HNWI investment
The survey found that capital value growth was by far the most important driver
of investment for HNWI cross border investors. The yield achievable in a particular
market and the exchange rate benefits were also identified as important by our
international HNWI. Inevitably however, there are variations between investor
groups depending on their local perspective. For example, in Kuala Lumpur, where
domestic rates of income return are low, the somewhat higher yields available in
London emerged as a key determinant of investment in the British capital.
TOP 3 HNWI FINANCIAL DRIVERS FOR GLOBAL REAL ESTATE INVESTMENT
Perceived
investment safe
havens were 30.8% 19.2%
Capital value growth Perceived safe haven status
highlighted as key
drivers by a fifth
of the markets
we surveyed
27.9 %
Yield
*weighted average, based on top 3 drivers, per office Source: Cluttons, VPC Asia Pacific
Diversification is inevitably a key driver of international investment for HNWI
investment and this was evident in the results of our survey, although there is less
focus placed on this factor than would be expected amongst institutional investors.
Overall, just under a quarter of our offices noted the importance of diversification
as a top driver of investment amongst the HNWI they represent, but wealth security
emerged as a more important consideration. In fact, perceived investment safe havens
were highlighted as key drivers by a fifth of the markets we surveyed, although were
found to be of particular importance to Gulf based investors. It is notable that our
HNWI investor client base from this region also cite precious metals as an alternative
asset class in which they invest; however this comes behind bonds and stock markets.
Three quarters of our offices report their HNWI clients also have an exposure to
equities directly or through funds, although this asset class appears slightly more
prevalent across the Asia-Pacific region.
Singapore (right) was edged into third
place, although there have been no
fundamental changes to the city-state’s
overall HNWI appeal.
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