Russian property market enjoys a fruitful 2011

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New research from the CBRE suggests that 2011 saw record investment volumes into Russian commercial real estate.

Morgan Stanley carried out the largest purchase of the whole year within the country, acquiring the 191,000 square metre Galeria shopping centre in St Petersburg for an estimated €840 million.

The research linked the stabilising of the Russian economy to renewed consumer confidence in the property market.

The research follows a new report from the Federal State Statistics Service which suggests that Russia’s housing market is set to attract further interest from investors as the country’s consumer price inflation dropped to 6.1% in 2011.

The Russian Government has aimed to create an attractive environment for investors over the last few years, but has struggled due to a number of reasons.

Russian prospects are promising, with only 24% of Russians taking out loans and only 18 % currently having taken out deposits with banks. In comparison, most Europeans use two or four financial products, and in some cases five to six.

The global housing market endured its worst performance in the third quarter of 2011.

Experts see it as unlikely that 2012 will quite match the same heights that the Russian property market scaled in 2011.

However, the effects of a positive 2011 are likely to be felt across property markets in the rest of Europe. The continent could certainly do with a boost of any kind at the moment.

Transferring money to Russia

If you are looking to invest in Russia, think carefully about how you will be transferring money to Russia. Foreign currency exchange rates quoted by banks are not usually the best way to send money abroad.

So if you are sending money to Russia – which you will inevitably have to do if you are looking to make a property investment - be sure to compare the market before you buy your overseas currency.

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Russian property market enjoys a fruitful 2011

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