RUSSIANS MONOPOLIZE LUXURY PROPERTY MARKET

Russian buyers are now the primary target for developers of luxury properties in their quest for foreign clients. The reason is quite simple: they are the nation who, on average, spend more money when buying a luxury home in Valencia, specifically, 918 700 EUR, this is despite the political crisis between Russia and the European Union following the conflict with Ukraine.

And according to data provided by the General Council of Notaries, buyers from the former Soviet Union now lead the ranking of investments in real estate for property of over 500,000 euros in three Spanish provinces.

The latest figures available, based on the first half of this year, indicate that wealthy foreigners spent 161 million euros on acquiring luxury homes in the Community (214 purchases), 10% more than during the same period last year.

Sources seem to indicate that those wishing to purchase luxury properties in Spain feel that the time is now right to make their investment as, with the worst of the crisis now behind us, you get the feeling that transactions are safe and profitable. The same sources added that the good sales figures "have little impact on the ‘granting of residence permits to foreigners who spend more than half a million euros on investment property.

Valencia is actually the third largest market for Russian clients in Spain with 59 transactions completed during the first 6 months of 2014 showing a total investment of 54 million euros. However, in the two Provinces out in front, Catalonia has sold 137 homes to Russiana, at an average price of 1,136 million euros, while in Andalusia there have been 94 properties, costing 98 million at an average price of 933,000 euros. After Valencia in 3rd position, the Canary Islands come next.

The figures show that every Russian investor who buys a house worth more than 500,000 euros in Spain actually spends EUR 1.065 million in the remainder of the country whilst in Valencia the spend averages out at 918,000 EUR with 18% of the national total.

The faithful and traditional British market, which has historically been the major customer of the autonomy in this type of transaction, now ranks second, with 25 purchases and an average spend per property of about 714,000 euros. It would seem that the reason why the British market has declined is that they are changing their preferences to other regions.

Of 397 luxury purchases made by British buyers in Spain only 6% are made within the Valencian Community. Norwegians, Belgians, Germans and the French complete the picture of customers of this elite market in the Community.

But local developers still rely on the British market and a delegation of Provia, the Alicante Promoters Association, has recently moved to London to negotiate agreements with British estate agents in the sale of property in the Alicante region.

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