Real estate is the most preferred investment asset class for high-net-worth individuals. As many as 31.07 percent of respondents believe that their investment allocation towards real estate sector will grow in the next two years, according to Hurun Indian Luxury Consumer Survey 2019.
As many as 49.51 percent HNIs surveyed said that the investments into real estate will retain status quo and the remaining respondents' group believed that it would decline.
Around 31 percent of the survey respondents chose to increase investment allocation to real estate in the next three years.
"In line with IMF’s prediction of economic growth, equity markets followed by fixed income is the second and third respectively in the category,” the survey by Hurun Research Institute said.
Also interestingly, 21 percent of the respondents want to reduce allocation into real estate in the short term, and around 20 percent want to reduce allocation into gold.
More than one fourth said that their investment philosophy for this year will be “avoiding risk”.
This is the first year that Hurun Research Institute has published this report to reveal the changes and preferences of lifestyle, consumption habits and brand cognition of high-net-worth individuals in India, and try to describe the changes in the lifestyle of Indian high-net-worth individuals.
The UK is the most preferred overseas investment destination, followed by Singapore.
UK comes out as the most popular overseas destination choice for investments despite socio-political turmoil in the region, the report said.
Singapore takes the second place and Canada along with USA, which is forecasted to grow by 2-4 percent (at constant exchange rates) this year, rank third.
“Increase in opulence and the rising millennial population in the country, investment into luxury products and service would witness an upward trend. If India’s GDP doubles in the next 4 years, that will have an impact on the number of new millionaires in the country – resulting in a direct impact on luxury spending and investments,” said Anas Rahman Junaid, MD and chief researcher of Hurun Report India.
In order to understand the spend trends of UHNIs, the report used the Hurun India Rich List, which features 831 richest Indians, Hurun India Real Estate List, and Hurun India Women List.
The average age of the survey respondents is 35 years, with males and females accounting for 58 percent and 42 percent respectively. As many as 51 percent are married, 46 percent are unmarried, and 2 percent are divorced. Their wealth sources are mainly composed of investment, dividends and wages. They come from many states and cities across India, including Delhi, Bengaluru, Mumbai and major second-tier cities and overseas cities, of which 64 percent are in the north and south.
Among other investments, education tops the list of major expenditure, followed by travelling and entertainment. Watches are the preferred choice for men's gifts The most popular Indian liquor brand is Old Monk. Amongst collectibles, Indian HNIs prefer to spend the most on art. Newspaper followed by TV are the preferred choices for HNIs to access information, the report said.
UK is also the most popular international tourist destination, followed by Italy and Maldives
Nearly half of the respondents said they don't know much about virtual currency. Among those who were educated about it, mentioned their preference to invest in Bitcoin (29.15%); the next 8.74 percent prefer Ethereum and 6.80 percent would like to invest on Ripple.
Visa/ Master Card based credit/ debit cards are the most preferred mode of payment among the HNIs. Nearly 17 percent of the respondents use cash for daily payment and the use of E-wallet among HNIs stands close to 9 percent, the survey said.
The most popular leisure activity for high-net-worth individuals is travel. Reading is the second most popular opinion, followed by family activities.
In terms of international vacation, the traveler’s favorite is the UK. Italy ranks second, followed by Maldives and Greece. More than one-third go on annual vacation for a duration of 10 to 20 days.
As running is getting popular by the year in India, Marathon tops the list of activities that HNIs would try in the next three years; Paragliding and sailing is second and third respectively in the list.
Overall, swimming, yoga and cycling are the three most popular sports for high-net-worth individuals. Amongst the three, swimming is the most popular sport
Nearly half of the respondents have two to three cars; 37 percent have only one car and 6 percent have more than five cars. Around 46 percent of them renew their car every three to four years.
Whiskey and red wine are the most preferred alcohol among high net worth individuals, followed by champagne. Nearly 38.46 percent of respondents said they did not drink alcohol, the survey said.
More than one third of the high-net-worth individuals are not into collecting. Among those who love to collect, most are into art and jewelry.
The overall happiness index this year is 8.7 points.
In terms of studying abroad, the United States, which has many world-renowned universities, is leading the list. Almost 30 percent of India’s HNI community want to send their children to study in the United States. Second position is bagged by the United Kingdom, followed by Germany and Canada that are ranked third and fourth respectively, the survey said.Taxation and environmental issues are of the biggest concern among high net worth individuals, the survey added.