Moscow homebuying surges as Britain spooks wealthy Russians

Moscow homebuying surges as Britain spooks wealthy Russians
The forced return of wealthy Russians from Europe as a result of explicit threats issued by UK authorities has boosted demand for premium property in Russia’s real estate market.

The number of inquiries for luxury property in Moscow and the Moscow region surged by 21 percent in the first quarter of the current year, according to market research carried out by consulting and real estate company, Metrium Group. Nearly 66 percent of the inquiries reportedly came from the UK, 23 percent from Germany, and nine percent from the US.

According to Russia’s Central Bank data, the volume of cash remittance for buying elite property from abroad hit an all-time high in the fourth quarter of 2017, when Russian immigrants transferred some 7.1 billion rubles ($122 million), representing 36-percent growth. The analysts say that the previous peak was fixed in the first quarter of 2014, when Russians brought back $102 million to buy real estate.

All in all, wealthy Russians transferred $265 million from foreign accounts last year, marking a 12 percent increase against $237 million returned in 2014.

“The surge in activity by our compatriots fell at the time when Russian business ombudsman Boris Titov revealed to Vladimir Putin a list of rich Russians who want to return to their homeland,” said Metrium Group Managing Director Ilya Menzhunov.

In December, Titov asked the president to allow magnates who had fled to foreign countries to avoid prosecution to return to Russia on condition that they pay compensation for their misdeeds.

The real number of transactions might exceed the Central Bank’s estimates, since direct transfers are not the only method of buying property in Russia with foreign capital, according to Menzhunov.

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