According to a representative of Adelanta Consulting Group, the new Russian district is becoming north London - Islington and Paddington. The large-scale reconstruction of the latter has increased the influx of those looking for housing and work here. In addition, demand has increased for housing in London's new business center (rival to the famous City) - Docklands and Canary Wharf, where offices of global banks, financial and legal companies are now located. And, of course, extra-class apartments in famous Belgravia, in the Highgate and Mayfair areas remain in value. These "square meters", like historic mansions, are not afraid of the mortgage crisis at all.
ISLAND INSTINCT
Not a year goes by without the British press breaking a sensation about the purchase of a multi-million pound mansion by someone famous, and Russian surnames are increasingly being heard. Experts suggest that such articles appear in British media at the instigation of local realtors trying to cure the ailing real estate market with the help of a miraculous "Russian pill". The logic here is understandable: if Russian billions are flowing to the island, then it's too early to talk about a crisis...
Half of Hollywood stars, rock musicians and Russian oligarchs have made their mark in Britain as new settlers. For example, Bob Dylan paid 2.3 million pounds for an 18th-century castle, and Madonna purchased a mansion for 9 million. According to the Scottish newspaper The Scotsman, the owner of the Novolipetsk Metallurgical Plant, Vladimir Lisin, bought one of the most expensive castles - Aberuchill - for 6.8 million pounds. Roman Abramovich, Boris Berezovsky and Nikas Safronov also have property in the land of Robert Burns. And the list is still expanding; the mortgage crisis is no obstacle for super-elite real estate.
Prices in this segment, as Itogi was confirmed by several large consulting firms involved in the sale of British real estate, continue to rise, though at different rates. According to Adelanta Consulting, the annual overall growth in value was 12.8%. The volume of transactions for the acquisition of real estate worth from 10 million pounds, for example, increased by 40%. According to The Times, about a quarter of all elite housing buyers are from Russia, having spent more than a billion pounds on British real estate in recent years. Recently, along with businessmen, more and more mid-level officials are appearing, English realtors say.
What attracts the "miracle island"? Firstly, London is the center of global stock exchange and financial activity. And those buying housing there count primarily on tax benefits. "If you invest in the British economy, even if not a very large amount, you get the right not to pay income tax," explains Ekaterina Ametistova, a partner at the British consulting company Address England. There is also the possibility of obtaining a residence permit after five years, and eventually acquiring a British passport. Plus a convenient judicial system and transparent legislation.
RENT FOR A THOUSAND YEARS
Elite real estate on the island can be roughly divided into two categories: super-expensive apartments in London and historic property in several counties. In both cases, the most important thing when buying is the type of ownership - it primarily affects the cost of housing. It has been the custom since the time of William the Conqueror that all land in England and Wales belongs to the Crown, and its subjects only have the right to use it. Hence two types of ownership: freehold and leasehold.
In the first case, you become the full owner of the land and building and can do whatever you want with your property, within reason, of course. The limits are set by local government.
In the second case, you are the owner of what is built on that plot. You lease the land for a period from one year to 999 years. And the less time left until the end of the lease, the cheaper the housing. What if the contract is not renewed?
Therefore, most firms do not recommend buying apartments in London if the lease has less than a hundred years left. In addition, buyers of leasehold property will have to pay the landowner an annual ground rent of 50 to 200 pounds. And the landowner decides on the scope of technical and repair work, the cost of which no one has ever managed to dispute, and it can amount to 10 or 200 thousand pounds. In the British capital, there are areas consisting predominantly of leasehold housing, and therefore very expensive, such as famous Belgravia.
London's most prestigious areas are considered Kensington, Chelsea, Knightsbridge, Belgravia, Mayfair, Notting Hill, Holland Park. The price for one-bedroom apartments of no more than 60 square meters here starts from half a million pounds, and mansions with gardens and fountains cost from 30 million.
CANTERBURY GHOST
London's most expensive suburbs are Windsor, Ascot, Surrey, Wimbledon, Oxford and Cambridge. But elite real estate can be found almost everywhere, just in these places its concentration is significantly higher. It is also important that "elite" here is available for every taste.
Not far from Windsor, a house with a huge plot of land, securely hidden behind elegant metal gates, was put up for sale. The house is a true masterpiece of modern architectural thought: glass, each room decorated in its own style and no repetition. Everything - from walls to decor - is an exclusive designer work. Not everyone can live in such a museum. But it will make an indelible impression on guests!
Roughly the same price - about 10 million pounds - applies to a typical English estate in the wooded area of Ascot. An old, gloomy house with a lawn and other attributes of the Victorian era. Three floors with a basement, garden, and probably ghosts were included (antique furniture certainly was part of the price). "Russians often look for something 'like Dickens' or 'reminiscent of Walter Scott'," says Ekaterina Ametistova. "True, in reality such structures turn out to be much less suitable for living than one would like."
But castles are generally a niche product. Although there are quite a few on the island – 433; of which 67 are privately owned, and the rest belong to local authorities or the National Trust. And it's no wonder: about a fifth of them are real ruins. According to the company Ashton Rose, only three or four castles are put up for sale each year. In reality, deals are made for one or two historic buildings. They protect not only information about the buyer but also about the seller. After all, aristocrats often give up their family nests because they cannot afford to maintain the ancestral estate.
By the most conservative estimates, maintaining a castle or historic manor costs 10-40% of its value. For example, maintaining Windsor Castle costs 600,000 pounds a year, and that's despite Her Majesty being a very economical housekeeper. By the end of the last century, castle owners were even slightly discouraged: the cost of living, and therefore the upkeep of estates, was rising, while buyers were becoming fewer. But then came wealthy Asians and Russians. Although castles are, of course, a niche product.
The requirements for preserving the historical appearance are extremely strict. For instance, a brick from the time of Richard III that has crumbled with age must be replaced with an identical one. So owners manage as best they can: they turn castles into hotels, sell them in parts, or hand them over to national trusts that create museums there. 80% of local castle owners follow this path. The profitability of such a business is low - only 5-8% per year, but it at least allows them to cover the maintenance costs. Some rent out the estate room by room, in which case the price of a "room" is roughly equal to a London five-star hotel; others rent out the entire house (that's about 5-10 thousand pounds per day). However, the starting price of a castle is not the highest - from a million pounds.
GENTLEMEN'S AGREEMENT
The rules for purchasing property in Foggy Albion are simple. Moreover, the commission fees for processing the purchase are reasonable – 4%, not 7% as on average in Europe. The United Kingdom applies both pan-European rules (deposit, notarization) and purely British customs.
For example, lawyers handle the collection of all information as well as the preparation of documents. It all starts with a Memorandum of Sale (names and addresses of the parties), which in addition to the property title also includes the property acquired with it (furniture, household appliances). Then come numerous checks with local authorities, land registry, bankruptcy register, and a one-time stamp duty is paid. It depends on the price of the property: up to 120,000 pounds nothing is paid, up to 250,000 - one percent, up to 500,000 - three, and over half a million - four percent of the transaction value. After all this bureaucratic red tape, a document appears - the purchase contract.
When everything is agreed, the transaction takes place on the appointed day and time. The buyer's lawyer sends the signed contract and deposit (about 10%) to the seller's lawyer, and in return receives the document signed by the seller. From that moment, the deal is done and neither party can back out. The payment schedule and conditions are agreed in writing (sometimes the process can take months, or it can be completed in one day). After all payments are made, the buyer receives a certificate of transfer of ownership. The keys are handed over at the same time. Legal support for the transaction ranges from 0.3 to 0.5% depending on the price of the property. Consulting agencies take 1-1.5% of the transaction, and this amount is paid by the seller.
The process of completing the purchase takes on average one to two months. There are two main schemes for registering a purchase: directly in the buyer's name or through an offshore company, which makes it possible to avoid paying stamp duty. "Consult a lawyer in advance," advises Ekaterina Ametistova. "For example, if the property is bought in the name of a company, then later you will have to rent it, and at market price." Another example: eventually the property will need to be bequeathed to someone, and the inheritance tax is 40%. It is much more convenient to register it as a gift, for example, to a child. After seven years, the gift tax will be 0%.
By the way, British tax authorities will definitely be interested in where the money for the purchase came from, whether the Russian mafia is involved. So you will have to prove the transparency of the source of funds. However, the fact that they accept all certificates in Russian makes things easier.
But acquiring elite housing is half the battle. It also has to be maintained. Any homeowner or apartment owner pays a municipal tax (Council Tax), which goes towards police, fire services, municipal housing, schools, libraries, and street cleaning. The amount is set by the municipality and can vary greatly within the same city. Price fluctuations range from 200 to 2,500 pounds per year. However, even for the most luxurious properties, the municipal tax will not exceed three thousand pounds per year. Owners of almost all apartments and some houses also pay a service charge (Service Charge). It is set by the residents' council or the managing agent overseeing the property. Its amount again varies sharply depending on the number of services (concierge, video cameras, garages, etc.) and the condition of the house, and ranges from 500 to 3,500 pounds per year (typically paid quarterly). Electricity and gas will cost 600-800 pounds per quarter. If the house is large, then household staff will likely be needed, who will have to be officially employed, meaning becoming an employer (and thus paying all relevant taxes).
Historical properties have separate requirements. Changing the exterior appearance of the house is practically impossible; architect approval is required. Even to cut down a dried tree in the garden, you must post a notice several months in advance and ensure that none of the neighbors object. There are also specific problems. One Russian who bought a house in the very center of London really wanted to watch Russian television. But he was never able to obtain permission to install a satellite dish. There have been cases where the state forcibly bought back property if the owner began to act arbitrarily. By the way, it is impossible to 'come to an agreement' with officials in England. That is precisely why you can still buy a castle there whose walls remember all its owners.