Russian investors are increasingly diversifying their assets into overseas property as a result of unstable global markets, it has been reported.
According to the New York Times, an unfriendly business climate and ambiguous Russian economic policy, has contributed to an outflow of capital from Russia, with 46% wiped off the value of the country’s RTS index in the last week alone.
“The unstable local securities market, a high price tag of real estate in Moscow and the involvement of Russia in world events, coupled with the growth of wealth of Russians, led to an understanding that it is best to diversify assets rather than invest in a local market that has become rather unstable and which is experiencing the slowing of price growth,” said Natalya Zavalishina, director of Moscow-based property agency Miel.
Hadleigh Bolt, of Bolt Property Group, which develops property in La Zagaleta, Spain, has noted a recent influx of Russian buyers. “We’ve seen a certain rise in the number of Russian nationals expressing interest in our bespoke properties. Somewhere like La Zagaleta offers enormous appeal to affluent Russians due to heightened security measures, the countryside environment, direct air access to Málaga and, of course, year-round warm weather.”
Amidst the negative news eminating out of the world capital markets, rating agency Standard & Poor’s has lowered the future credit rating of Russia and Moscow from “positive” to “stable”. The outflow of capital in August 2008 equalled 1% of the country’s GDP, or about $13billion.
Article courtesy of the Overseas Property Professional Magazine
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