However, as Metrinfo.Ru notes, they are aimed not exclusively at Russian speakers, but often at all foreigners in general. Or, if we are talking about European countries, against those arriving from non-EU countries. Conflict of interests
The very first question that arises: why is this being done? It also seems unclear why our buyers are on the one hand seemingly enticed, and on the other hand driven away. Illogical? But that's only at first glance.
The fact is that no country in the world is, so to speak, monolithic: any state is a multitude of people, each pursuing their own interests. What does a real estate seller need? That's right, to sell. And to anyone – the main thing is that they pay as much as he wants. But other parties in the process (primarily the state) have different interests: they have to think about ensuring that wealthy foreign buyers do not drive prices sky-high – otherwise housing becomes unaffordable for their own citizens. Also, care must be taken that property does not fall into the hands of various "shady" individuals.
In general, while some (sellers) show us their enthusiastic disposition (quite mercantile), others (officials and ordinary people) mutter through clenched teeth something like: 'They've come in droves!' Let's accept this fact as given and see how exactly it is done.
Strictly prohibited!
There are countries in the world that simply prohibit foreign citizens from buying real estate. Moreover, we are not talking about 'islands of stability' like North Korea. Among such 'prohibitors' are, for example, the Czech Republic or Bulgaria. In the latter, however, this applies to houses with land plots, while apartments are mercifully allowed to be purchased.
At this point the reader may think that the author has mixed something up. After all, the Czech Republic traditionally ranks in the top five countries where our compatriots buy real estate most actively. And in Bulgaria today such a quantity of housing is being built and sold (including houses with plots) that these offers have filled all thematic exhibitions... In fact, there is no contradiction here. The laws of these countries strictly prohibit foreign citizens from buying real estate personally, but have nothing against an apartment or house being owned by companies registered in these countries. And the owner of the company can quite legally be a foreigner. Moreover, the company may conduct absolutely no activity, submit zero reports year after year – supervisory authorities are not alarmed by this.
As knowledgeable people say, the ban was initially introduced to keep overly wealthy buyers out of the market – in the 90s, however, they were more afraid not of us, but of citizens of the FRG. However, lawyers serving foreigners immediately came up with the aforementioned antidote with companies, and it became clear that the ban was pointless. They even planned to repeal it, but... didn't. Why? In the Czech Republic, for example, maintaining an 'empty' company costs its owner €350 per year – filling out all sorts of forms, taking them to the tax office. The authorities reasoned that a wealthy foreigner wouldn't care, while some good sir (or madam) gets 'pocket money' from it. Why deprive their own citizens of this pleasant addition to their income?!
For the sake of fairness, we note that there are countries where bans on foreign acquisition of real estate are real, not fake. For example, in Switzerland there are quotas for such sales, with no more than a certain number per year. And in some cantons it is not sold at all. As a result, the country pleases its own citizens with affordable housing.
On 'criminal' money and 'mortgage for Russians'
Europe and the rest of the Western world are literally obsessed with the issue of 'purity' of money. A suitcase full of cash is for them not even puzzling and suspicious, but completely obvious: the funds are criminal. Good money should be in a bank and come from buyer to seller via bank transfer.
However, just a bank is not a panacea. Once the author of these lines was present at an event where they talked about French real estate. The speaker told a curious story. A certain man wanted to buy a very expensive castle in the land of the proud Gauls, and he had money, as expected, in a bank. But the name of the bank contained the word petroleum, and this fact somehow greatly puzzled some vigilant French bureaucrat. As a result, the deal fell through, and the unlucky buyer ended up in some bad computer database, and entry into the EU is now forbidden for him.
Around the world, it is customary to buy real estate with a mortgage. There is a crisis now (we will discuss it in more detail below), but even in pre-crisis times, getting a loan for a buyer from the CIS was an order of magnitude more difficult. The reasoning: you have an unclear country, the documents you provide do not inspire confidence. Although... Here again are Czech realities: standard conditions for citizens of the country – lending up to 85% of the property value at 5-6% per annum. And there are 'special' conditions – a loan of only up to 50% of the value, and a rate of 7-8% per annum. At the same time, the bank requires almost no documents from the borrower – in professional circles this is all called a 'mortgage for Russians'.
And they will impose tribute everywhere
Taxes, as is well known, are obligatory companions of real estate. Strictly speaking, they cannot be considered a deterrent measure i.e., something that the authorities deliberately create to screen out undesirable buyers. On the other hand, our people naturally become accustomed to a certain level of expenditure on their real estate – and when faced with other realities, shock occurs. As a rule, in states that do not deliberately attract foreign buyers with low taxes, annual rates are around 1-2% per year – meaning, having bought a house for a million, one must be prepared to pay 10-20 thousand annually.
But this is the average, and individual cases are downright mind-boggling. For example, the author long did not understand why real estate in Italy practically does not sell, while in Spain – please! And the countries are very similar in terms of climate. The explanation is simple – the real estate tax on the Apennine Peninsula can easily amount to 5% per year or more. The position of the communists is strong in the country, and these guys are generally inclined to solve the problems of the poor at the expense of the rich. Foreign real estate buyers undoubtedly fall into the latter category – here they are, local followers of Marx believe, let them pay for everyone!
Also, in some countries, foreigners are prohibited from commercial exploitation of real estate. Live in it yourself, but don't rent it out, so as not to create competition for local rentiers. And, of course, renting (where it is allowed) is impossible without paying taxes. And in the Eurozone, reminds Oleg Repchenko, head of the analytical center 'Real Estate Market Indicators IRN.RU', they amount to 52%.
You won't be able to speculate with real estate in many countries either. The tax system of Austria, says Svetlana Abelyan, head of the branch of the company 'New City', is structured so that upon quick resale (earlier than five years), the tax will eat up 90% of the profit. The entire system, the expert notes, is aimed at ensuring that real estate is acquired primarily for living, not as an investment tool.
The crisis will make them love
To everything said above, one very important caveat is needed: we were talking about the system that has developed in recent years. But now a crisis is raging on global markets, and hunger, as is known, sharpens the mind and discourages one from pompously puffing up one's cheeks.
I recall a press conference with an American whom the event organizers presented as a big real estate expert. He turned out to be no expert at all – he answered all questions with the unshakable optimism of a poor student: don't know, haven't read, haven't thought. But that's not the point. When the man was asked about the state of the market in his native America (and the first rumors about the crisis were already leaking at that time), the effect was as described in 'The Twelve Chairs': 'Ippolit Matveyevich was transformed. His chest arched like the Palace Bridge in Leningrad, his eyes shot fire, and from his nostrils, as it seemed to Ostap, thick smoke poured out. His mustache slowly began to rise.' Then – this is where we return to our narrative – followed a furious tirade about how anyone who wants to buy housing in his magical USA must be prepared to pay a very large amount of money and at the same time be immensely happy: it's America after all! We see, we know. Just a couple of months ago, news came that a house in Oregon was sold for $1.75. No, that's not a typo.
So, what is the likelihood that the current crisis will force foreign states to be more modest and welcome any money, even if it comes from these 'terrible Russians'? Most experts give a positive answer. For example, Olga Pobedinskaya, director of the foreign real estate department of the DOKI agency, believes that given the current state of affairs in England, Germany and the Scandinavian countries, many developers pin their hopes on our buyers. 'We talked with French brokers about interesting and even unique projects, and they directly stated that they will wait for a buyer only from Russia,' the expert notes.
Yulia Titova, director of the foreign real estate department of the company 'BEST-Nedvizhimost', agrees with this assessment: she is confident that 'in light of the crisis, when there are many offers and fewer and fewer solvent buyers, the very question of screening out people with money from Russia is very, very irrelevant.'
Only the words of Svetlana Abelyan ('New City') sounded somewhat dissonant. In her opinion, those countries that previously attracted buyers from Russia may come up with something new for even greater attraction. But those who previously actively defended themselves will not soften their position. 'This is not the kind of capital the West needs. The reputation is too unfavorable,' the expert is convinced.
Let's hope that the crisis will force stubborn foreigners to be more hospitable to our buyers.