Property Investment
An unstructured reply.....
Apartments in Moscow are sold on a per square meter rate, a little different than Ireland. Apartments in Moscow are also much larger, a lot of the older apartments in the sought after Stalin buildings (which were built for the upper class) are very grand and spacious. Most second hand apartments are sold in an un-renovated condition; the current price for a two bedroom within the Garden Ring is approximately 2,000 US Dollars a sq meter (1,600 euro) or less depending on the condition and era of the building, type of building construction, and its proximity to the Metro.
Prices has dramatically increased in the past few years, prices hit rock bottom after the 1998 finically crisis when foreign companies had to either down scale or leave Moscow, during this time a huge amount of expats also left Moscow. Prices have now recovered and are now either on par with 1998 or even higher.
Mortgages are just beginning to immerge in Moscow, generally people do not save money here; they either spend it or invest it in property. They is now a huge flow of foreign banks coming into Moscow as they see the potential; One US backed mortgage company is [broken link removed] - rates are high, between 9 and 14%. The majority of property transactions are carried out in cash; all this oil money has to go somewhere!!! It sounds scary however it is all very professionally carried out now.
The most sought after apartments in the center have rents between 2,500 US (2,000) and 3,500 US (2,800 euro). One of the reasons for the high rental market is the lack of hotels in Moscow. A typical renovation costs in the region of 260 dollars a sq meter (210 euro); this would include new partitions, floor finish, ceilings, electrical and finishing works. Ikea is the typical source for furniture.
The monthly fees for utilities are still ridiculously low. Building maintenance, gas, heating and telephone fees amount to about 40 US dollars (32 euro) a month. Every apartment is heated by the state; you just pay a monthly fee. Our electricity bill normally comes to the sum or 3 or 4 dollars a month.
The standard rate of Tax is 13%, this is a flat rate. For non residents for the rate is 30%. There are ways to avoid this tax.....
Currency: The property market is priced in US Dollars or Euros. Nothing in the property market is priced in Rubles.
Economic risks: Russia is now so westernized it is extremely unlikely it will go in any other direction. Since Putin arrived there is a sense of stability in Russia hence the foreign investment. Obviously this is shaken when this is a “terrorist” attack.
I feel once mortgages become available and affordable to the masses, real estate will dramatically rise.
Some reading:
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