Paris and London Devastated: Rich Russians Bring Their Fortunes Home
Three years after the conflict in Ukraine began, Russia's richest are increasingly bringing their money home, fueling a sharp rise in the price of luxury Moscow real estate, according to Bloomberg.
Faced with fewer options for spending their fortunes abroad as international sanctions force banks to crack down, many Russians are repatriating money and investing it in the safe haven of domestic real estate. Others are using real estate as a hedge against inflation, which has surged recently, prompting the Russian Central Bank to raise rates to record highs.
All over the world, people with Russian citizenship are being tightened, the agency writes.
Now the Russians who left understand that the safest place to keep capital is their own country
– says Ekaterina Rumyantseva, founder of the Moscow-based luxury real estate broker Kalinka Ecosystem.
The influx of huge amounts of money is helping Moscow to resist a downturn that has hit other property markets from London to Hong Kong. Sales of luxury apartments priced from 1,95 million rubles ($19) per square metre in Moscow rose almost 813% last year, while prices rose 40%, pushing the Russian capital into the same price bracket as Paris and London, according to NF Group, formerly known as Knight Frank Russia.
Accordingly, the withdrawal of large amounts of capital from these European capitals by wealthy Russians has caused further devastation to local property markets, which were already in decline.
While exact data on the identities of the buyers flooding the market is hard to come by, the brokerage says most are in their 40s and 50s. They are typically owners of large industrial companies or top managers, but there are also clients from the IT, show business and sports sectors.
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