Volumes in the Russian real estate market for H1 are at less than half the amount for the same period last year, with foreign money scared away by sanctions, delegates at the PropertyEU CEE investment briefing heard.

Volumes in the Russian real estate market for H1 are at less than half the amount for the same period last year, with foreign money scared away by sanctions, delegates at the PropertyEU CEE investment briefing heard.

‘Russian volumes are down at around €750 mln for the half year, compared to €2 bn at the same point last year,’ said keynote speaker Damian Harrington, a research director with Colliers International.

‘But that’s not the whole story. It is only in Russia and Ukraine that have been impacted so far. Everywhere else is starting to see increasing volumes. Poland should at least match last year, and the Czech Republic will probably beat last year by a significant margin,’ he added.

Neil Gregory-Eaves, also a director with Colliers, noted that, ‘we’re just starting to see the start of the impact sanctions will have. For instance, in the Baltics, sanctions are impacting dairy farming, but not yet real estate. Polish GDP has been pared back a little, but generally things are pretty positive.’

He added that, ‘in the more central European markets, we’re seeing little to no effect. In fact, capital rates are down, lending rates are down, margins are down and investment inquiries are up. Obviously, Russia has become a largely internal market and all bets are off for investing in the Ukraine.’

For the full story, see the November issue of PropertyEU.