Housing drives NZ wealth: Are you in the 1%?
New Zealand’s growing house prices are helping propel the population to among the wealthiest in the world, a new report shows.
Property consultancy Knight Frank has released its wealth report for 2021, which assesses how the fortunes of ‘‘ultra-high net worth individuals’’ are changing.
Head of research Liam Bailey said the way governments had responded to Covid-19 had supported the wealthy. The number of ultrahigh net worth individuals, defined as having net wealth of more than US$30 million (NZ$40.7m) including the value of their own home, grew 2.4 per cent higher over the past 12 months, to more than 520,000 worldwide. In New Zealand in 2015, there were 158,782 people with net wealth of more than US$1m. In 2025, that is predicted to hit 359,251. Last year it was 208,384.
The number at the top of the tree with more than US$30m is predicted to increase from 1904 last year to 2886 in 2025.
The report’s model predicts the global population of ultra-high net worth individuals will grow by 27 per cent over the next five years, and the number of US-dollar millionaires is forecast to rise by 41 per cent.
While the US would remain the dominant ‘‘wealth hub’’, Asia would have the fastest growth in the superrich over the next five years, the report said, at 39 per cent compared with a 27 per cent global average.
By 2025, Asia would be home to 24 per cent of the world’s superwealthy, up from 17 per cent 10 years earlier.
There are more billionaires in Asia than anywhere else in the world. China was driving that, with 246 per cent growth in the number of very wealthy people expected in the decade to 2025.
House prices were rising because of the pandemic, not despite it, the report said, and New Zealand was leading the pack. Auckland had the fastest-rising house prices of the 100 cities surveyed in the report, up 18 per cent in 2020.
Knight Frank said the country’s handling of the pandemic, rapid economy recovery, ‘‘ultra-low mortgage rates’’ and limited supply of stock were behind the surge.
In the next three places were Shenzen, up 13 per cent, Seoul up 12 per cent and Manila up 10 per cent.
ANZ chief economist Sharon Zollner said house prices were a big driver of New Zealanders’ wealth because property was a favoured asset class for many people.
‘‘There are lots of structural reasons for that, including the marginal tax rate advantage that housing has. There is a huge amount of household debt and wealth in the housing market, and that goes right up to the top 1 per cent.’’
The net wealth needed to join New Zealand’s ‘‘top 1 per cent’’ is now US$2.8m, the report said, which is the fifth-highest in the world behind Monaco, Switzerland, United States and Singapore.
Wellington woman Liz Willmott was left in the dark about a mysterious candlelight concert after event promoter Feverup.com changed the date, then offered no refund.
An advert for the ‘‘intriguing’’ Vivaldi gig for February 4 appeared on her Facebook feed, with venue details kept secret. ‘‘It was pretty flash, quite a comprehensive website,’’ she said.
‘‘I thought, no-one would go much trouble if it wasn’t real.’’
Last July, she booked two $45 tickets, one for herself and one for a friend, and got confirmation with a QR scanning code at the time of booking.
By early January, she still had not heard where the concert venue was and started to worry that it was a scam.
She contacted Feverup twice, receiving an automated reply saying an agent would contact her in two or three days.
No-one from the company followed up, she said. to this
At the end of January, she was sent an email to say the date had changed.
If she could not make it to that concert she could go to another, she was told, but there was no offer of a refund.
She and her friend were unable to go and, in the end, the tickets were used by other friends.
‘‘I thought if they changed the venue fairly late in the process, they should offer a refund,’’ Willmott said.
‘‘It did not seem entirely honest to me.’’ One Reddit user managed to get a refund from Feverup for a concert in
Christchurch earlier in February, after the date changed on the morning of the event, but said it was an ‘‘overall really weird experience’’. Under Feverup.com terms and conditions, ‘‘you use the services at your own risk’’ as tickets were nonrefundable even if there was a date change or cancellation.
Consumer NZ chief executive Jon Duffy said people should think twice before buying tickets from the event promoter.
Feverup sometimes did not disclose key details at the time of booking, such as the venue and performer, and the website made claims such as ‘‘Tickets running low’’ and ‘‘Limited tickets on sale’’.
‘‘What has really stood out is the draconian no-refund policy,’’ Duffy said.
‘‘If they are not able to provide a gig on the day they said they will, and an alternative date does not suit you, you are entitled to a refund. They have potentially misled you.’’ Customers could lay a complaint with the Commerce Commission under the Fair Trading Act if they felt misled about their rights, or take Feverup to the Disputes Tribunal if they wanted to pursue a refund.
‘‘Covid means there could be any number of things that happen in a pandemic that mean a promoter cannot put an event on. Is it worth your while buying a ticket to an event like this? If everything changes, you won’t get your money back.’’
Duffy advised people to buy tickets from the official sellers or organisers of an event and said it was important to carefully read the fine print.
If a company refused to issue a refund, customers who paid by credit or debit card could request a chargeback from their bank.