The season of giving is approaching fast and with it the challenging ‘art of the gift’. Finding a solution for certain partners and acquaintances – be they close friends, family or business colleagues – is no easy task, especially in the current marketplace. Guidelines can help.

overview: Colin Sharp – sources: Standard Bank SA / Financial Times, UK

A wish list is an itemisation of goods or services that we desire in the now, or pretty soon. The would-be recipient might provide copies of their list to sympathetic or interested parties who could be likely to purchase gifts for them. So an intelligent rationale is to engender communication between the gift receiver and its giver.

That’s what Habitat is facilitating here: showcasing ideas for the coming festive season – all of them high-end – some representing lasting investments.

So, ideally, the wish list should contain items that a gift purchaser can obtain from a variety of sources i.e. that are readily available. And yet it might be highly specialised – or very particular – in categorising individual marques, products and manufacturers; available via retail or online.

Investments of Passion

What really excites individuals is the unattainable zenith of trend predictors’ thumb sucking. To them it’s alien and seldom relevant because general trends, rather than small numbers, are the measurable staple of any economy. Big volumes count and it’s quite extraordinary how a sector such as the 17-25 global age group will all wear similar clothes, eat and drink likewise, admire the same entertainment icons and use the same or similar IT devices and social
media platforms.

Their aspirations remain equally in parallel as they mature. After 30 they may likely upgrade a little as personal tastes develop, but will otherwise remain within the confines of the trend predictor’s parameters, being regarded as ‘the norm’ insofar as spending patterns. 

It’s markedly different for high net worth individuals. Because individual they most certainly are.

Figuring Out

Exposure to alternative investments only changed 9 percent in the past year for Africa’s wealthy compared with a global average of 29 percent. This, according to the 2018 Wealth Report published by Knight Frank, Standard Bank Wealth and Investment’s global property consulting partner.

Furthermore, a total of 23 percent of high net worth African clients were found to collect an ‘investment of passion’ such as art, wine, jewellery, watches or classic cars; while the global average is 37 percent with as much as 47 percent in Russia and 44 percent in the Middle East.

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There are various reasons why investments of passion might be on the wish list, but the main factor is the joy of ownership. However, for the high net worth client in Africa it’s been noted that capital appreciation is of high importance; this being of relevance because it’s expected that this type of investment should increase in popularity in the future as wealth levels rise.

While Africa only saw an increase of 7 percent in those with assets of US$5-million, this is expected to increase by as much as 33 percent by 2022. Notably, 76 percent of wealth advisers in Africa say their clients’ wealth increased in 2017 and will do so again in 2018. South Africa alone is forecast to see a 20 percent uplift in its ultra-wealthy population over the next five years following a 14 percent rise in 2017.

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Investing in a passion therefore can form part of an over-arching, goals-based investment plan – in order to avoid any unpleasant surprises down the line.

For the full article see Habitat #268 November / December 2018


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