NZ ranked fifth in global wealth status

New Zealand is the world’s fifthrichest country on a per-adult basis, a new report shows – and thanks partly to our house prices.

The Credit Suisse Research Institute has released its latest Global Wealth Report, which shows global wealth rose by

US$9.1 trillion (NZ$14.2t) or

2.6 per cent, compared with last year, to US$360.6t. For the first time, New Zealand has been included in the report.

In New Zealand, total wealth rose 4.2 per cent in the 12 months to mid-2019 and wealth per adult increased 3.1 per cent. That was despite a 0.8 per cent decline in the New Zealand dollar compared with the United States’ currency.

‘‘New Zealand is the world’s fifth richest country as measured by per adult wealth. Only Switzerland, Hong Kong, the US and Australia rank higher. New Zealand’s wealth is also reasonably evenly distributed, with median wealth also being the fifth highest in the world. Both rankings represent improvements on the previous year,’’ said John Woods, Credit Suisse’s chief investment officer for Asia-Pacific.

Overall, since the year 2000, wealth per adult in New Zealand has grown at an average annual rate of 8.1 per cent in US dollars and 5.7 per cent in New Zealand dollars.

At the start of the century, wealth per adult in New Zealand was US$71,630, placing it 24th among the leading 100 economies.

But steady growth has lifted it to fifth, behind Australia but ahead of Singapore and Canada.

Median wealth of US$116,440 is also fifth highest in the world. The average is US$304,120. The report said real household assets had grown more quickly than financial assets due in part to rising house prices.

In mid-2019, real assets made up 47 per cent of gross household wealth, compared with an average of 42 per cent in the year to

mid-2011. ‘‘Almost half of average wealth comprises real household assets ... Importantly, household debt has been declining in relative terms since 2008,’’ Woods said. The report said household debt now averaged US$43,240, which equates to 12.4 per cent of gross wealth.

New Zealand also had belowaverage wealth inequality for a high-income country.

The top 1 per cent wealthiest New Zealanders hold 19 per cent of the wealth. That compares with the top 1 per cent owning 45 per cent of net assets on a global basis.

Only 9.3 per cent of New Zealanders have assets of less than

US$10,000.

The proportion of the population with wealth of more than

US$100,000 is 54 per cent, which is about five times the global average.