The Real Deal New York

High-net-worth individuals’ investable wealth hits $56T

Nearly 19 percent of the population's money is invested in real estate
September 18, 2014 06:00PM

The investable wealth of high net worth individuals hit a record high in 2013 as the overall population of the wealthy grew and equity markets improved, according to a new report.

The number of high net worth individuals with $1 million in investable assets grew by 1.76 million people, according to the World Wealth Report 2014 from Capgemini and RBC Wealth Management. The increase pushed the population’s investable wealth up 14 percent to $56.62 trillion.

North America remains the wealthiest region with $14.88 trillion in high-net wealth. Asia-Pacific came in second with $14.2 million. Growth in Asia-Pacific’s population of high net worth individuals narrowed North America’s lead to fewer than 10,000 people.

Cagpgemini and RBC broke down the financial asset classes in which high net worth individuals are investing by region, offering a view into real estate allocations.

Across the globe, high net worth individuals allocated 18.7 percent of their wealth in real estate in the first quarter of 2014, down from 20 percent in the same period last year. Latin American millionaires had the largest share of wealth in real estate (27.6 percent), followed by the Middle East (25.4 percent), Europe (23.4 percent) and Asia-Pacific excluding Japan (23 percent).

Real estate accounted for 14.1 percent of North American high net worth individuals’ financial assets. Japan came in last with just 11.4 percent of high net wealth invested in property.

More money is crossing borders, according to the report. In the first quarter of 2014, high net worth individuals invested one-third of their wealth overseas, compared with one-quarter in the same period of 2013. – Tom DiChristopher