According to Knight Frank’s latest Wealth Report, the number of ultra-high-net-worth-individuals (UHNWIs) in Vietnam is set to grow by 26% between now and 2026. The growth in Vietnam was mirrored by the dynamic Asia Pacific region, which trailed only North America in the growth of its UHNWI population. 

Victoria Garrett, head of residential at Knight Frank Asia-Pacific said: “Despite slower growth in 2021, Asia-Pacific’s foothold as host to the world’s leading wealth hubs remains strong as ever. The affluent continue to be bullish on the region’s trajectory, which can be witnessed by the forecasted growth in the UHNWI and HNWI population between 2021 and 2026. In addition, the number of billionaires in Asia-Pacific is also expected to rise quicker than the global average in the same period.” 

Knight Frank forecasts that the global UHNW population will grow by a further 28%, with Asia and Australasia (+33%) seeing the largest growth, followed by North America (+28%) and Latin America (+26%).  

 Flora Harley, deputy editor of The Wealth Report at Knight Frank said: “Asset price rises, from property markets to equity markets and luxury collectables, have all helped boost the fortunes of those wealthy enough to have investment portfolios. Research from The Wealth Report reveals that, on average, just shy of two-thirds of UHNWI wealth is allocated to property. Just under a third of total wealth is held in principal and second homes, while the remainder is invested directly or indirectly into investment property.” 

The report further found that globally private capital investment into commercial real estate totalled US$405bn in 2021, marking a 52% increase on the previous year and 38% above the pre-pandemic five-year average.  Looking further into 2022, the Knight Frank Attitudes Survey reveals that close to a quarter (23%) of ultra-high-net-worth individuals (UHNWIs) plan to invest directly in commercial real estate. In terms of sectors, private capital will be predominately directed toward offices (43%), followed by industrials and logistics (17%) and residential (16%).  

Knight Frank, which announced the opening of its Vietnam subsidiary in a ceremony in Ho Chi Minh City last month, has noted similar patterns within the fast growing southeast Asian nation. 

Knight Frank Vietnam Managing Director Alex Crane said: “We anticipate Vietnam to be represented prominently in this report in the next few years as economic fundamentals and Vietnam’s position on the world stage continue to accelerate. We have witnessed prime apartment sales break the US$10,000 barrier this year driven by local demand, and with Vietnam expected to increase 26% in number of UHNWIs between 2021 and 2026 on par with Hong Kong SAR and Taiwan, we can see the potential for ongoing growth well into the future beyond that”.   

Meanwhile, the report also noted a marked trend in discretionary spending from UHNWIs and HNWHIs toward watches and wines, which both saw sales growth of 16%.   

Local import data mirrors these findings for Vietnam, which has seen the import of watches increase 28.2% annually from 2016 – 2020 despite the impact of Covid-19. Car sales and Wine import, prior to being impacted by the pandemic, had consistently maintained positive growth of 12.9% and 9.8% p.a 2016 – 2019, respectively.  

Interestingly – and for the first time – NFT sales have risen to prominence among HNWIs, with world’s main auction houses selling US$228 million of NFT or crypto art last year, while in total over US$81 billion of NFTs were sold via online platforms and this trend looks set to continue.  

Victoria Garrett, head of residential at Knight Frank Asia-Pacific, said: “Art collectors have changed the way they collect their passions quite radically over the past years as the marketplace has been largely disrupted by the emergence of NFTs and cryptocurrencies. The younger generations who are known to be more tech-savvy and the most educated find the NFT art marketplace especially appealing due to the rising and unpredictable prices – which is exciting for them as it is an opportunity for them to flip the collectables into profits digitally while being untraceable.” 

(*) HNWI – High-net-worth individual – someone with a net worth of US$1 million or more, including their primary residence  

(*) UHNWI – Ultra-high-net-worth individual – someone with a net worth of US$30 million or more, including their primary residence