JUNE 2010 |
www.opp.org.uk WORDS | Geoff Hadwick
Where and what are they buying?
of France, business from Russia is looking good so far this year. The Russians like the traditional values associated with the Cote d’Azur. “Last year we sold to 3 Russian
F
clients and this year we have already made 3 sales to Russians,” she says. Our Russian clients are buying anything from small one bedroom apartments in Nice to luxury penthouses and villas in Cannes.” Expectation levels are a bit more modest than they were though. “Demand for very high-end properties – i.e. more than €20m - has fallen signifi cantly” says Emanuel. “In this segment of the market, only 24 months ago, you would hear of villas being sold for hundreds of millions of Euros and you could more or less guarantee that
Why is prominent Russian tycoon Roman Abramovich is currently looking into purchasing land in Chalkidiki?
Probably because things are as cheap as they are ever going to be and the EU will have to stabilise the Greece, as a major Euro currency economy, whether it likes it or not. Things remain tough though and, as Antonio Kollaros of Domus Real Estate says, “until 2009, Greek banks, as well as foreign banks in Greece, were offering mortgage loans to construction companies and Greek or foreign house buyers, including Russian buyers. Russians got loans to purchase houses because the interest rate in Greece was far lower than that in Russia and 90% of houses were purchased through bank loans. Today there is practically no bank offering mortgage loans because of decreased cash fl ows.
or Judith Emanuel of Attika International, an agency that specialises in the South
every time someone paid over €50m for a property it was a Russian buyer.’ Attika International is staying calm and carrying on, just like its Russian clients. “The South of France will always hold great appeal to the Russians no matter what the economic climate is doing,” says Emanuel. “They buy mainly for pleasure, very few buy in order to renovate and sell on due to the fact that many do not speak the language and they are worried about orchestrating the works from abroad.” This desire to avoid any kind of
renovation or refurbishment work is also driving activity in Turkey. “We have we noticed a trend for buying completed projects (key-ready properties) and exclusive luxury projects,” says Advantage Properties International Managing Director Alper Apaydin.
For instance, he says, the Golf and
Dream Village in Bodrum is doing well, not least because it is a key- ready project with 100% guaranteed developer non-status fi nance. Turkey also appeals because
Russian buyers don’t need to obtain a visa for every trip anymore and Apaydin says that his business is seeing more and more inspection trips. “All they need to do now to buy a property is obtain a Turkish residence permit … which is very easy and non- bureaucratic. We are defi nitely seeing increase in interest from Russian clients for properties in the Bodrum, Antlaya and Dalaman regions.” Indeed, “anywhere on the Mediterranean has always attracted Russian buyers,” says Antonio Ribes Bas, general manager of Rimontgo in Spain. “They want an alternative investment to the Russian stock market, which is heavily infl uenced by the volatile oil market.”
London | Remains a very popular city with Russians looking for good schools
Large seafront properties do well, as always, and Russian buyers also like to see agents who are members of leading international luxury real estate networks such as the European Real Estate Network, Christie’s Great Estates, the Luxury Portfolio and Leading Real Estate Companies of the World. Major European cities like Paris,
London, Vienna, Zurich and Geneva continue to be very popular … not to mention the USA. Agreed, says Alexander Utochkin, head of research at Chesterton’s Moscow Offi ce: “We mainly deal with high-end properties and Russian buyers looking to buy in traditionally popular prime locations such as London, South of France and Monaco, Italy, Switzerland and USA. Before the recession, wealthy Russians were active buying high-end property in exotic locations like the Caribbean and Mauritius but the demand has reverted back to locations which have had a relatively stable property market.” Utochkin is clear that “modern Russian buyers are well educated about foreign property and tend to have a clear idea about what they are looking
to purchase. They look overseas for a number of different reasons … to expand their investment portfolio, to establish their position in society, to set up a base for business and for their children being schooled overseas.” London’s top schools are seen as a massive attraction.
Property funds, especially in the UK, are becoming more and more attractive to Russian buyers. They are keen to take advantage of a weak Sterling exchange rate. “In 2008-2009 the demand for overseas property amongst wealthy Russians outweighed that for properties in Russia itself,” says Utochkin. “We’ve noticed that as the economy has started to recover and the ruble has strengthened, demand for property in Moscow has increased. Luxury apartments in the centre of Moscow and country houses on the outskirts are sought after by wealthy Russians looking to invest locally.” At the low-end of the market, Chesterton sees Russian buyers seeking apartments in destinations such as Bulgaria, Montenegro, Turkey, and the Ukraine, where prices now start from as little as US $30,000.
Developer profi le
THE RUSSIAN REPORT Buyers | 35
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