What are the key takeaways from The Wealth Report 2023 for European UHNWIs?

Over 65 pages in length and crammed with data, survey results and insights the report takes some time to digest.

This year, we’ve produced a spin-off report for European markets distilling all the key information into one short document to help clients understand the key trends shaping markets on the continent.

Below we’ve summarised the key findings for the Wealth and Home chapters but go online for more on Investing and Investments of Passion.

Wealth

• The ultra-wealthy in Europe are optimistic in 2023 despite the turbulence
• Across Europe, the level of aggregate wealth held by ultra-high-net-worth individuals UHNWIs fell by 17.3% in 2022. This is higher than the global decline of 10%.
• Despite this, 41% of wealth advisers said their European clients’ wealth increased in 2022 compared to 24% in the Americas and 40% globally. Of the European markets surveyed, wealth advisors in Italy and Spain said their clients’ wealth had increased the most, by 36% and 34% respectively.
• The top three drivers behind wealth performance in 2022 were real estate, currency trades and market timing. Declines in 2022 were attributed to equity markets, financial markets and interest rate moves.
• On average, 32% of European UHNWIs’ total wealth is allocated to primary and secondary homes, the figure is higher in Austria (59%) and Italy (42%).
• European UHNWIs are more optimistic than those globally with 74% expecting an increase in their wealth in 2023, above the global average of 69%. UHNWIs in Switzerland and Spain are notably optimistic at 91% and 81% respectively.
• Inflation is the top threat to UHNWI’s wealth in 2023 (as stated by 67% of respondents), interest rates (58%) and the political/geopolitical environment (53%) occupy the second and third spot.
• The top opportunities for wealth creation in 2023 include real estate (46%), technology (33%) and equity markets (28%).
• In Europe, 12% of UHNWIs are planning to apply for a second passport or new citizenship. This figure is highest amongst Austrian and Swiss UJNWIs (12%)

Home

• Prague, the Algarve, Athens, and Porto led Europe’s prime price rankings in 2022
  Global prime luxury residential prices deflated from 8.4% growth in 2021, but didn’t collapse, with average growth of 5.2% recorded in 2022 in the PIRI 100. Prague, the Algarve, Athens and Porto were Europe’s top performers with annual price growth of 16.3%, 15.3%, 13.0% and 12.7% respectively. Amongst European cities Madrid, Paris, Lisbon and Dublin lead our prime price forecast with each expected to see prices increase 4% in 2023. Zurich (3.5%), Monaco (3%) and Vienna (0.5%) complete the top five.
• For current relative value, US$1 million can buy 17 sq m of prime luxury internal floor space in Monaco, 34 sq m in London, 37 sq m in Geneva, 43 sq m in Paris, 70 sq m in Berlin and 106 sq m in Madrid.
• On average, Europe’s ultra-wealthy own 3.8 homes, marginally higher than 3.7 homes globally and higher than the 2.7 figure in the Americas. Some 16% of European UHNWIs bought a home in 2022, while 15% are planning to buy a home in 2023. Our HNW clients said the investment, lifestyle and safe haven motivations were the top reasons for purchasing. Some 29% of Europe’s ultra-wealthy own homes overseas, lower than the 35% in the Americas but significantly higher than the 12% in Australasia.
• Top of the preferred list of locations for European UHNWIs are Spain, Italy, France, the US and Portugal.
• The most international markets France, Spain, Italy, the UK and Greece are the five most international residential markets globally. In both France and Italy, the UK, Swiss and Dutch buyers are the top three purchaser nationalities. In Spain, buyers from the UK, France and Germany dominate.

Download the European Takeaways report

Download The Wealth Report 2023