Good days ahead for Vietnam's ultra-rich: report

By Vien Thong   March 1, 2022 | 07:00 am PT
Good days ahead for Vietnam's ultra-rich: report
Women walk past stores in Hanoi, November 2021. Photo by VnExpress/Ngoc Thanh
The number of people owning more than $30 million in Vietnam, or the ultra-rich, will cross 1,500 in 2026, a 26 pct increase from 2021.

This is an estimate contained in the latest annual Wealth Report released by U.K. property consultancy Knight Frank.

It says Vietnam is expected to have 1,551 ultra-high net worth individuals (UHNWIs) by 2026, compared to 1,234 last year.

The company also predicts that the number of rich people, or those with a net worth of $1 million or more, including their primary residence, will rise sharply by more than 59 percent from last year to 114,807 in 2026.

"We have witnessed prime apartment selling prices break the $10,000 per square meter barrier this year, driven by local demand, and with Vietnam expected to increase the number of UHNWIs between 2021 and 2026 by 26 percent, on par with Hong Kong SAR and Taiwan, we can see the potential for ongoing growth well into the future beyond that," said Knight Frank Vietnam Managing Director Alex Crane.

The report also notes a marked trend in spending by ultra-rich and rich people on watches and wines. Vietnam's import of watches increased 28.2 percent annually in 2016-2020 despite the impact of Covid-19.

Car sales and wine imports, prior to being impacted by the pandemic, had consistently maintained positive growth of 12.9 percent and 9.8 percent, respectively, between 2016 and 2019.

The Knight Frank report counts more than 610,000 ultra-rich people around the world last year, up 9.3 percent against 2020.

It predicts that the global UHNW population will grow by a further 28 percent by 2026, with Asia and Australasia seeing the largest growth at 33 percent, followed by North America at 28 percent and Latin America at 26 percent.

The report says global private capital investment into commercial real estate totaled $405 billion last year, a 52 percent increase over the previous year and 38 percent above the pre-pandemic five-year average.

It expects around 25 percent of the ultra-rich people to invest directly in commercial real estate this year. The report says private capital will be predominately directed toward offices (43 percent), followed by industrial and logistics sectors (17 percent), and the residential segment (16 percent).

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