Moscow, June 22, 2011 – Based on the results of the research performed, an international real estate agency Gordon Rock formed a country-based rating of Russian investor trust to foreign property. The leaders of Russian investors trust rating became Germany, Great Britain and France. And as for Bulgaria, Spain and Montenegro, which are so popular among those Russians, who buy property to live in, they did not even make it into the list of ten countries that bring investor trust.
The research was performed within March-May, 2011 through a survey of several thousand respondents, both actual, and potential investors from Russia, who only consider how appropriate foreign investing is. The parameters of country comparison by the respondents were based on the political and economical country risks, real estate sector stability, the level of legislative protection of investor interests, real estate liquidity, as well as included the presence of the insurance system for developer projects, the possibility of the investor's receiving a residency permit or simplification of the visa mode for the investors, the presence of the projects with the guaranteed rental income, the accessibility of mortgage for Russians and a number of other parameters.
The leadership of Germany, Great Britain and France in the rating of Russian investors' trust is not surprising. This is due to the fact that these countries have the strongest economies in Europe, a high level of investor protection, including non-resident investors. The sectors of real estate of these countries went through the world financial crisis without substantial losses. The residential and commercial real estate is characterized by high liquidity. Due to the accessibility of fixed rate from 3% mortgage for the Russians as well as due to a quite high and often guaranteed income, the investors from Russia can quite count on receiving a stable yearly income of 10-15% on their investments.
Also included in the top 10 countries, where the investment in real estate is also trusted by the Russian investors, are Austria, the USA, Italy, Cyprus, Israel, Czech Republic and Latvia. In this case, the presence of Cyprus and Latvia in these top ten countries, causing investors' trust, is, first of all, due to the possibility of receiving the residence permit in these countries when buying property there. The high position of the USA in the rating can be explained by the fact, first of all, that the abruptly grown investor activity from China, Canada and the Near East in the US real estate market was not unnoticed by the Russian colleagues, and, secondly, by the fact that many Russian investors have monetary funds in significantly cheaper dollars, one of the most optimal ways of liquidation of which is buying American real estate that has not become cheaper because of the weakened dollar.
It is worth it to separately pay attention to the fact that the country investor trust rating is significantly different from the rating of demand among those Russians, who buy foreign real estate “for living”, and not “for the investments”. Therefore, Bulgaria, Montenegro and Spain that have been taking the leading positions in the real estate “for living” for many years, have been left far behind ten countries that are trusted by the Russian investors. The only country that took up the leading positions in the “real estate for living” rating and in the “real estate for investment” rating is Germany.
It is quite simple to explain the radical rating differences. It is due to the fact that Russians, buying real estate abroad “for living”, mainly pay attention to the following factors: the historical and cultural closeness of the country, transportation accessibility, favorable visa conditions, the possibility to receive residence permit and permanent place of residence. It is not hard to notice that this set of criteria is seriously different from the factors that lay the basis of investors' decisions. Therefore, Russians tend to buy real estate for themselves in Bulgaria, Montenegro and Spain, but they don't consider these countries for investment purposes right now.
The president of the International real estate agency Gordon Rock Stanislav Zingel comments the research results: “Specializing, first of all, on the investment real estate, we see that the factor of trust to the country is one of the key factors when the investor makes decisions concerning foreign property investments. During the recent 2-3 years Russians became more demanding to their investment targets abroad. Therefore, it was not coincidental that the leaders of the Russian investor trust became the same countries as their Western European colleagues have”.
For additional information, please, refer to:
+7 (495) 220-2827, Stanislav Zingel, the President of the International real estate agency Gordon Rock
The International real estate agency Gordon Rock offers a complete set of services on investments into hotel, commercial and income property. Gordon Rock is the official representative of more than 150 leading foreign builders, implementing developer projects in the area of real estate in 30 countries.