New Zealand eexperienced the greatest increase in adult wealth in the world in 2021, according to a new report.
Credit Suisse, an investment bank, found that between 2020 and 2021, the average wealth per adult jumped a whopping $114,289, or 32%, bringing the average wealth per adult to $472,153. The report also found that out of a population of just 5 million, 42% of New Zealanders are in the top 10% of global wealth holders. The United States came in second for growth in average wealth per adult, at $73,630, followed by Australia ($66,354) and Canada ($55,662).
However, the growth in wealth in New Zealand is somewhat skewed with wealth inequality on the rise. Most of the growth was due to housing and global markets. New Zealand economist Shamubeel Eaqub, speaking with the Guardiandescribed the growth as the “rise of the landed gentry, with wealth and housing opportunities becoming more hereditary.”
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Eaqub said 60% of the growth had come via housing, with the remainder due to booming global financial markets.
“The increase in house prices has been extraordinary,” the leading economist said. “But with only roughly half of New Zealand adults owning their own home, the increasing wealth was very unequally distributed.”
The fact that New Zealand experienced such astronomical growth in wealth from 2020 to 2021 was no coincidence, according to Credit Suisse’s report, pointing to the effects of the COVID-19 pandemic as a major cause.
“The strong rise in financial assets resulted in an increase in inequality in 2021,” the report said. “The rise in inequality is probably due to the surge in the value of financial assets during the Covid-19 pandemic.”
While New Zealand’s mean growth in adult wealth was $114,289, the median growth is just half that, at $57,920.
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The biggest losses in wealth were experienced by Japan, Italy, and Belgium.