Kenya's ultra-rich no match for African peers
SEE ALSO: The value of a good reputation“Despite accounting for 16 per cent of the world’s population, Africa only accounts for one per cent of the total worldwide… total wealth held on the continent amounts to $2.2 trillion (compared to total private wealth in the world estimated at $304 trillion). The report puts the total private wealth in Kenya at $93 billion (Sh9.3 trillion). In Africa, the private wealth is estimated at $2.2 trillion with almost half of which is held by high net worth individuals, painting a most unequal picture across the continent. “Around $920 billion (43 per cent) of this is held by high net worth individuals,” said the report. The report estimates that individual Africans have net assets (wealth per capita) of approximately $1,900 (Sh190,000), with Kenyans falling slightly below this average at $1 870 (Sh187,000). Mauritians are the wealthiest individuals in Africa with an average wealth of $31,000 per person followed by South Africans with an average wealth of $11,500 per person. “Kenya had a difficult 2018 (Kenyan wealth was down by around 10 per cent during the year) as the local stock market lost significant value. However, if one looks over the longer term, the trend is still quite positive with wealth growth of 64 per cent over the past 10 years. This shows that Kenya is still probably the most resilient market in Africa among the traditional ‘Big 5’,” said the report.
SEE ALSO: It pays to put cash in empowering peopleAccording to the report, Nairobi did not make it to the top five richest cities in Africa but was instead ranked sixth, with a wealth of $49 billion. South Africa’s Johannesburg is the wealthiest city in Africa, where the total wealth held in the city is $248 billion, much of it in Sandton. Other top rated cities were Cape Town ($133 billion), Cairo ($129 billion), Lagos ($96 billion) and Durban ($54 billion). “The economic hub of East Africa is one of the fastest-growing cities in the world. Total wealth held in the city amounts to $49 billion. Affluent parts of Nairobi include Runda Estate, Lavington, Kitisuru, Karen and Muthaiga. Major industries there include financial services, real estate, tourism, media, clothing, textiles, processed foods, beverages and cigarettes,” said the AfrAsia report. A recent Wealth Report by Knight Frank, which put the number of Kenyan with assets worth over $1 million (Sh100 million) at 9,482 in 2018, also noted that Kenyan high net worth individuals prefer putting money in real estate. According to the March 2019, the property makes up 43 per cent of Kenyan high-net-worth-individuals’ investment portfolios, which is higher than the preference of other rich people in other African countries where 39 per cent prefer investments in property. The majority of Kenya’s super-rich (59 per cent) have invested in real estate in the country, while 27 per cent holds property interests outside the country, according to the Attitudes Survey insights.
SEE ALSO: KPA face an acid test in qualifiersRespondents to the survey said 42 per cent of their Kenyan clients increased their exposure to property investments in 2017, further indicating confidence in the asset class. The Knight Frank Wealth Report further reveals that affluent Kenyans own an average of 1.9 homes (primary residences and second homes not bought as investments), which is lower than Africa’s and global averages of 2.1 and 2.9 homes for the super-rich respectively. However, 16 per cent of Kenya’s wealthy plan to buy additional homes within the country in 2018, while only 8 per cent is looking to purchase abroad. Buyers with $1 million to spend on high-end homes can purchase a luxury residential property with 6,383 square feet of space in Nairobi, making the city one of the cheapest locations for prime residential buyers. Monaco is the most expensive location globally, with a million dollars affording just 173 square feet.
Do not miss out on the latest news. Join the Standard Digital Telegram channel HERE.