Takeaways From The Knight Frank Wealth Report 2025
I have always enjoyed Knight Frank’s (KF’s) Wealth Report and for a few years organized the Australian contribution from UHNWI’s (ultra high net wealth individuals), family offices and private bankers to the international survey, in my previous role as National Partner, Private Office. This edition is No 19 and like past editions makes great reading. My congratulations go to Liam Bailey, Rory Penn, Kate Everett-Allen, Flora Harley, Andrew Shirley and others who researched and wrote the report.
I hope they always keep up the great work as international people movement and real estate are intertwined, and we need a commentator to research the markets and tell us what trends are emerging and which are fading. Knight Frank’s report gives us an insight into how the wealthy see global opportunities.
I have distilled some of the take aways as follows:
Artificial Intelligence (AI) has itself been disrupted
Geopolitical power is shifting more rapidly than ever
Investor allocation is moving at record pace in reaction to risks and bubbles.
KF Wealth Report Editor, Liam Bailey said “Even with elevated global risks, for me the standout takeaway from this year’s report is the breadth of investor opportunities. From growing luxury residential markets, through established, as well as new, commercial property opportunities, to the next big collectible sectors, the prospects for growth are compelling for those willing and able to look beyond the risks”.
Key findings
60% drop in investment volumes across global property markets since the market peak in 2021. That trend is now changing and 44% of global family offices will increase property allocation this year. While direct real estate ownership already accounts for 22.5% of the typical family office’s portfolio, more than four in 10 are looking to grow this allocation over the next 18 months. Sectors in demand are led by living, logistics and luxury residential.
Every G20 nation has failed to meet its annual housing targets for the past 5 years.
Luxury on pause. KF’s roundup of luxury collectible performance reveals that values for a basket of 10 leading assets fell by an average of 3.3% in 2024. The art market underperformed, with values down by 18.3%, while wine and whisky also contributed to pulling our overall luxury index into negative territory.
Global Wealth
USA dominates global wealth because of the strength of the equity market and the Bitcoin run.
39% of all wealthy individuals call America home (20% China and 5% Japan)
An AI powered boom will favour USA and China
Billionaires deconstructed (New billionaires by industry since 2014)
Manufacturing (International billionaires)
Technology – (Mark Zuckerberg $177b & Jeff Bezos $194b)
Finance and Investment – (Warren Buffett - $133b)
Fashion & Retail – (Bernard Arnault - $233b)
Healthcare
Food and Beverage
Real Estate
Diversified
Media & Entertainment
Automotive – (Elon Musk – $195b)
Generational Wealth
If our respondents were to receive a substantial windfall, almost half said they would spend the money on experiences rather than material possessions.
Work for home v Work from work
81% of UHNWI work remotely.
The lowest income respondents to the KF survey – those with a household income between US$125,000 and US$150,000 – tend to live closer to their offices, but the trend shifts dramatically as incomes rise.
Respondents in the second-highest income bracket (US$500,000 to US$1 million) typically live more than 75km from their workplace while more than 15% of the highest earners – those making over US$1 million – live at least 200km from the office.
These HNWIs aren’t daily jetsetters; rather, they have mastered flexible working. While remote work is possible for over 80% of survey respondents, it’s the highest income earners who most frequently work remotely.
International work opportunities have expanded their horizons, too. A large portion of those earning more than US$500,000 actively pursue cross-border career opportunities.
Luxury asset list for the next generation (popularity out of 100)
High end real estate – 29.8%
Luxury car – 27.8%
Private jet – 15.1%
Art – 12.4%
Superyacht – 8.9%
Wine – 4.4%
Other – 1.6%
What does $1m buy in residential in the top global cities
Comparison from 2014 – 2024 (10 years)
Over the past five years, geopolitical and economic turmoil have reshaped global property markets. Amid the Covid-19 pandemic, inflation and rising interest rates, markets such as Miami and Dubai have thrived, driven by shifting work, tax and lifestyle patterns. According to KF’s Prime International Residential Index PIRI 100, a US$1 million luxury residential property investment in January 2020 would have grown to US$1.9 million in Miami and US$2.7 million in Dubai by 2025
Where in Australia is expected to boom? – Sunshine Coast
My take on the KF Wealth Report as it applies to Australia
Global tensions, tariffs and wars are concerning. Liquidity will be important to shifting direction quickly. Commercial property isn’t liquid and won’t necessarily be the place for investing.
Iconic residential apartments, of international standards & reputation are now being collected like handbags and old cars. They are to be lived in and enjoyed as UHNWI tour the world.
Singapore, Shanghai and Sydney have shown solid growth over the past 10 years whereas the accepted international cities of Monaco, Hong Kong, London and New York have either languished or fallen in value.
Residential property values are unlikely to decline whilst housing remains in short supply.
Limiting immigration is a political pressure release with minor impact, which will spurn another boom once immigration is normalized.
Remote working is here to stay and will mean that older office stock must be repurposed to housing stock ASAP.
Generational wealth of US$124 trillion is expected to transfer now through to 2048. beneficiaries will be heirs and charity
Bank of Mum and Dad is rumoured to be Australia’s 5th largest bank and is responsible for up to 80% of deposits for first home buyers (sample 52,000 rolling average). This is down from 99% in 2015 however grandparents contributions are up to over 12% from 5.2% in 2021 – source ABC News. This shows a multigenerational strategy to fund family homes which broadens the burden and adds extra financial capacity to demand causing prices to rise.
Tax – wealthy people are and will continue to be targeted and property is the easiest pathway. Expect beach houses and rural retreats to hit the market as land tax bites.