Post-pandemic Principle #4: Demographics are destiny - follow the money flows

The past few years have opened up unprecedented opportunities to work remotely, live and earn overseas as a digital nomad, or to live on your own terms as your own boss. 

In this new mini-series, I discuss the 8 key principles for post-pandemic prosperity and embracing the opportunities that have arisen to the full. 

Demographics are destiny

A number of countries around the world face declining populations as birth rates have declined.

These include Japan, China, South Korea, and others...in some cases the population is expected to halve over the course of this century.

A declining population may not always be a bad thing. 

It takes pressure off infrastructure and housing, and if GDP per capita and productivity improve then living standards may still increase.

On the other hand countries with little immigration and a falling population tend to see innovation stifled, and a crippling dependency ratio heaps more and more pressure of the younger taxpayers.

One thing that a falling population is really bad for is real estate prices.

Detroit's population boomed to 1.85 million by 1950 as its auto industry thrived, and then fell to just 639,000 over the following 70 years, and is still declining today at around 632,000.

The average house price fell from US$100,000 to around just $15,000 in the immediate aftermath of the global financial crisis.

Follow the money

A number of developed countries have anticipated this and are now running extremely strong immigration programmes: New Zealand, Canada, the United Kingdom, and Australia, for example. 

But it's also about who, not just how many.

After dropping to near zero during the pandemic, migration of high net worth individuals (HNWI) is set to hit record highs this year, and even higher levels next year.

Global capital is more fluid than ever before, and it's been leaving Russia and now Hong Kong. and by virtue of being the largest populations the biggest number of HNWIs migrate out of India and China.

Australia is now the #1 destination for multi-millionaire migrants.

There's an old saying in real estate that you should find out where the people are moving to and buy the land before they get there.

Understanding demographics - the opportunities and the threats - can be your edge. 

Follow the money flows. 

I discussed this a little further in the short video below:

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