Russian Buyers Increasing in Overseas Property

A survey carried out across several major Russian overseas property exhibitions has found that almost 2 thirds of Russian investors are preparing to complete purchases in the next 6 months.

The results of 3 surveys carried out at major aiGroup property investment shows found that 71% of Russian investors are planning on completing their purchases in the next six months.

Kim Waddoup, chief executive of aiGroup also said that the exhibitors at all three shows had reported "stronger than ever interest in their properties".

Russians, once a massive force in overseas property had dropped off during the financial crisis, but are now coming back with a vengeance. The rush on overseas property is part of a wider trend of capital flight from Russia as those in the emerging market seek out safe zones for their cash.

Central Bank chairman Sergei Ignatyev has estimated $49.3 billion has left the country in the first nine months of the year, already outstripping 2010’s figure of £35.3 billion. $13 billion of capital left Russia in September alone…70% of the third-quarter total.

As far as buying overseas property goes, the Russians favourites have changed a little since the boom time. Russians were known for favouring destinations within a short-haul flight, and with a similar culture/background to their own, with Bulgaria and Ukraine being very popular, although Spain has long been the favourite.

According to a survey of 499 investors conducted by International Residence at the Moscow International Investment Show in March, Spain is still the favourite, followed by Bulgaria and Turkey is the newcomer in third place.

Top Russian Portal Publishes Search Data

Leading Russian overseas property portal 1-property.ru has just revealed its first ever chart of top overseas property destinations, based on search data from users of the site.

The top 5 is as follows:

1. Bulgaria
2. Spain
3. Turkey
4. Montenegro
5. Cyprus

Firstly, Bulgaria in number 1 is particularly significant. No, not that it is a favourite with Russian buyers, who have always tended to choose Eastern Europe for their beach holiday homes, but for Bulgaria's ailing property market. The number of Russian buyers is growing rapidly, and the Bulgarian property market is in a lot of trouble from oversupply. Russian buyers could potentially increase in volume sufficiently to really pull the market out of the proverbial.

Secondly Spain, another significant result, though we have been hearing similar reports about British buyers returning to Spain, it seems the dark clouds may be lifting there as well. It also has a massive oversupply problem and needs all the help it can get.

What a result for Turkey in third. Turkey is climbing the ranks of British charts as well, and for it to be third with Russian buyers backs up the reports we have been hearing from Turkish property agents.

Montenegro certainly isn't surprising, it has long been a favourite with Russian tourists.

Cyprus, again, a market in a lot of trouble, left near-baron by the exodus of British buyers, and could gain a lot from an influx of Russian ones.