Global Real Estate Investment Outlook 2025 – Key Insights from Knight Frank Report

The Knight Frank Wealth Report 2025 offers powerful insights into how the world’s wealthiest families are thinking about real estate. With responses collected from 150 family offices across APAC, Europe, Latin America, North America and the Middle East, the report reveals a strong and growing conviction toward long-term property investments.

Below, we break down the key findings — and what they mean for investors, especially in the Indian market.

Family Offices Are Increasing Their Real Estate Allocations

A significant 44% of global family offices plan to further increase their exposure to real estate. Among them, the Asia-Pacific region leads the trend, with 51% of APAC family offices intending to expand their real estate portfolios.

This signals high confidence in the sector, even during times of global uncertainty.

Where Are the Wealthy Investing Today?

Knight Frank reports that the top real estate sectors by current allocation are:

• Offices – 20%

• Luxury Residential – 17%

• Industrial – 14%

• Hotels – 12%

For these family offices, real estate is a balancing component within broader wealth strategies that include equities, private investments, and venture capital. Some continue to hold real estate for core commercial operations, while others treat it as a stable, long-term income proxy to protect purchasing power.

Real Estate Remains a Long-Term Play

One of the strongest insights from the report is the investment horizon of family offices:

• 0–3 years: 2.7%

• 3–6 years: 31.8%

• 6–9 years: 28.2%

• 9+ years: 37.3%

This clearly shows a long-term mindset. Most family offices invest in real estate for six years or more, reinforcing the view that property is a wealth-building asset class—not a speculative one.

Preferred Modes of Investment

Family offices prefer three primary routes when investing in real estate:

1. Direct property ownership

2. Investing through a fund

3. Joint ownership structures

Direct ownership remains the most popular, but structured and fractional ownership / fractional investment models are gaining acceptance globally — especially among younger, more flexible investors.

Why the Wealthy Invest in Real Estate

Knight Frank highlights three main motivations:

1. Growth & Capital Appreciation

2. Wealth Preservation

3. Income Generation

The first two — appreciation and preservation — dominate global investor strategy, confirming that the world’s wealthiest families view real estate as a long-term, capital-building asset rather than a short-term yield instrument.

Residential: The Cornerstone of Generational Wealth

Nearly two-thirds of global family offices maintain large portfolios of residential properties. Two reasons stand out:

1. Family Use & Legacy Building

Residential real estate is often purchased with a generational lens. For example, a property bought in Worli two decades ago has likely multiplied several times in value — creating lasting wealth for children and grandchildren. This is also one of the key reasons for NRI investment in India. People buy assets in their hometown with a hope that they might move their after retirement or when they visit India, they have a place of their own.

2. Capital Preservation

Residential real estate provides stability. Even in worst-case scenarios, the market rarely dips significantly, ensuring the principal remains safe. It aligns with the mindset of: “Don’t lose my money.”

Sectors Expected to Grow Next

The top sectors family offices plan to invest in include:

• Living Sector – 14% (residential, student housing, senior living, hospitality-linked living)

• Industrial & Logistics – 13%

• Luxury Residential – 12%

The growing interest in the Living Sector mirrors global demographic trends: urbanisation, nuclear family structures, student mobility, and aging populations.

Barriers to Real Estate Investing

Knight Frank also identifies the biggest challenges family offices face when entering real estate:

Barrier	Percentage
Identifying reliable partners/operators	23%
Tax regimes	20%
High competition for quality assets	19%
Regulatory & compliance issues	17%
Limited expertise	8%
Lack of market transparency	7%
Access to capital/finance	7%

Notably, many of these challenges are the same barriers that prevent retail investors from accessing high-quality properties.

What This Means for Claravest Investors

The 2025 Knight Frank Wealth Report makes one thing very clear:

The ultra-wealthy continue to rely on real estate — especially residential — for long-term capital appreciation and wealth preservation.

But historically, retail investors have struggled with real estate investment in India due to:

• Difficulty finding credible developers

• Lack of professional asset management

• Limited expertise in evaluating future appreciation

• The high capital requirement for high-quality properties

Claravest was created to eliminate these barriers.

At Claravest:

• We thoroughly analyse every property for strong appreciation potential

• We work with top-tier operators to manage and maintain the assets

• We offer fractional ownership, enabling investors to participate with amounts as low as ₹1 lakh (depending on the asset)

This allows everyday investors to access the kind of high-quality residential opportunities that have traditionally been available only to large family offices.

Final Thoughts

The Knight Frank Wealth Report 2025 reinforces what global wealth managers have known for decades:

Real estate is the backbone of long-term wealth creation.

With increasing demand for residential and living-sector assets, and a strong preference for long-term holding periods, the global trend aligns perfectly with Claravest’s mission — making real estate more accessible, transparent, and rewarding for every investor.