The unknown Europe. 10 countries for the Russians

April 21, 2014

The unknown Europe. 10 countries for the Russians

The ee24.com points out 10 European countries that are in the shadow of “grands” and are not well known for the Russian investors, but there is something to look for. The advantages of these countries, real estate markets outlooks and the current offers – all this is in new ee24.com survey.

There are such European countries that were once popular among Russian buyers, but then lost its positions. There are also pseudo-popular countries – people ask for real estate there but do not buy it. There are countries yet little-known for Russian customers as their market is quite new but experts believe that their popularity is still ahead. Albania is among such promising destinations and opens our rating.

1. Albania. On the threshold of the start?

The unknown Europe. 10 countries for the Russians | Photo 1 | ee24
The southern coast in Albania

A small charming country that has access to the Adriatic and Ionian seas and that worth a lot. Albania has not yet received the EU pass, but the European Fund and the IMF have already sent some assets, allowing to build up roads, waste treatment and tourist facilities. Naturally all this is estimated by the Russian buyers as “pro” arguments except for one "but”: almost complete lack of information about the possibilities of this country.

Benefits. A possibility to buy a hundred meters near the beach with the Adriatic Sea view cheaper than for €1,000 per sq. m. exists only in Albania - in other European coastal countries prices are two times higher. Real estate prices recently remained stable and tourist infrastructure develops quickly. The country's authorities annul visas for the Russians in summer period and in addition allow country visits for all holders of Schengen "multi visas".

Market. From 2002 to 2007 Albania experienced a building boom and prices increased by 15% – 20% per year. First foreign investors entered the local market. The global crisis made some adjustments but prices haven’t dramatically decreased. The most active foreign real estate buyers were from Scandinavia. The Russians interest has grown in recent years. They acquire property for vacations but investment purposes are still ignored.

Current offers. One bedroom apartment near the spa town Cerreto in Durres at the first line of the Adriatic sea with private beach costs from €35,000. Apartment with two bedrooms in the heart of the southern resort of Albania – Saranda at the first line of the Ionian sea costs from €40,000 up to €70,000. Sea villa in small seaside village is from €120,000. Apartment in new building in Shendzhin, north Albania, second or third line is from €25,000.

2. Hungary. Warm and damp

The unknown Europe. 10 countries for the Russians | Photo 2 | ee24
The Lake Heviz

Hungary is probably the most promoted among all the European holiday countries without direct sea access. Here are thermal springs, mineral spas, Heviz and Balaton lakes, wellness, treatment facilities, yachting and surfing. Country demonstrates the economic power as much as it is possible for industrialized former Soviet bloc participant. However, despite the tourist popularity and obvious investment advantages of Hungary, consumer passion of the Russians is restrained by the lack of sea coast.

Benefits. It is one of the most stable economies of the European post-Soviet space with developed industry, good level of agriculture and great tourist infrastructure having old-aged traditions. Is the member of the European Union and the Schengen area and thus means that owning property here is an annual reason for a tourist Schengen visa. Prices are low for the center of Europe and it is still possible to purchase an apartment or a house in the resort provincial village for €25,000-40,000.

Market. Having survived the stormy crisis (more than 100% in 10 years) growth, and then approximately a 30% prices decline, Hungary housing slowly drifts further. About thousands of non-residents annually purchase housing here, and according to the official statistics, their number grows each year by 10%. Russians buy rare in Hungary, choosing investment apartments in Budapest for rent or houses and apartments near the spa sources for vacations.

Current offers. Apartments with one or two bedrooms in the center of Heviz are from €80,000 to €120,000. Country house 10-15 km away from the Balaton and Heviz lakes is from €25,000. Small 1-2- bedroom apartment in the center of Budapest is from €60,000. Apartment in modern business-class house in Budapest is from €140,000.

3. Austria. Stability despite the crisis

The unknown Europe. 10 countries for the Russians | Photo 3 | ee24
Salzburg

Real estate market in Austria is one of the few in Europe that has survived the economic crisis without interrupting the relaxing price growth. Demand among local and foreign buyers remained active since 2007. Country could become a place of increased dislocation demand among the wealthy Russians, if not a "but ": it is not so easy to get a property ownership, not being a citizen, or even a resident of the EU. However, investors find some workarounds.

Benefits. International rating agencies for several years called Vienna the best city in the world due its life quality. Foreign investors are attracted by high life quality, stable economy and steady prices rise. Half a billion euros of annual property investment in Vienna form 80% of the total market in the country.

Market. Austrian capital is one of the most expensive and most popular cities for investors in Europe. From 2007 to 2012 the cost of apartments in Vienna increased by 32%. As a result, the average price was €3,800 per square, and in the central elite areas it reached €9,000. Besides apartments in Vienna, deals come in the holiday segment where villas and apartments on the ski and thermal resorts are purchased. Square meter in Soelden starts from €5,000, in Ischgl, St. Anton- am-Arlber – from €10,000. Business objects – retail, office spaces and hotels are in demand.

Current offers. Apartment in a renovated old house in Vienna will cost at least €250,000. You may buy an apartment with 1-2 bedrooms near Vienna, on the thermal spa resort of Baden from €100,000. Chalet with panoramic views of the Alps in the Kitzbuehel resort is from €2 million. Old houses in the Gastein Valley can be found for €500,000-700,000.

4. The Czech Republic. Past glory residues

The unknown Europe. 10 countries for the Russians | Photo 4 | ee24
The Prague Old Town

Five years ago Czech Republic was far more popular among the Russian buyers than it is today, but the reasons are not in crisis prices fall. On the one hand it is a calm and beautiful developed European country, the Schengen Agreement member. On the other hand is convenient logistics as it still is center of Europe ... but the main argument was that the Czech Republic until 2010 provided to non- EU residents the opportunity to obtain simplified procedure resident status – through legal entity opening, without obligatory business operating. Once first difficulties appeared at this field, the Russians interest instantly extinguished.

Benefits. In so-called regions with a growing tourism potential (Beskydy, Jizera and Krusne mountains) you may buy an apartment or a house in treating spa resort zone several times cheaper than in the popular resorts. Wilderness and new tourist and sports centers will be a plus.

Market. After the peak price values in 2008 square meters fell in average by 30-45%. Prague and Karlovy Vary are quite popular among the Russians. Apartments in new projects at the capital in a good area cost €2,500 – €3,500 per square meter. Total cost of a small, but liquidity apartments starts from €150,000. Prices in Karlovy Vary and Marianske Lazne are at the same level. In the province they are in 4-5 times lower.

Current offers. Two-bedroom apartment in Prague-1 (Old Town) with panoramic view on the Vltava River and a fine finish is for €144,000. Two-bedroom apartment in Teplice with mountain view costs €18,000. House in Brno, 95 sq. m with a land plot area of 171 square meters, a small garden and separate garage costs €143,000. Five-storey villa with a total area of 827 sq.m on a plot of 700 sq.m, located 300 meters away from the famous colonnade in Karlovy Vary costs €1.2 million.

5. Slovenia. The bulwark of future immigrants

The unknown Europe. 10 countries for the Russians | Photo 5 | ee24
The Lake Bled

Situation is reverse to Czech. The same arguments that worked ten years ago: Schengen country easily gives permit after incorporation. It is one of the most important arguments for the Russians.

Benefits. Access to the Adriatic Sea and the Schengen zone. Western-European, not the post-Soviet performance of a small country is still a bonus.

Market. From 2004 to 2007, the housing market in Slovenia has been rapidly developing – prices rose by 10-13% per year. Since 2009 inverse dynamics began – minus 8-10% per year. In 2013 the decline slowed. New projects almost absent and the prices for second homes vary. This country cannot be called very cheap, although local realtors say that the domestic market offers options with 2-3 times lower prices than ones published in advertising banners in RuNet.

Current offers. Apartment in Ljubljana, in a new building, in the city center starts from €2,000 per square meter. The house of 150 square meters in spa resort Rogaska Slatina costs from €300,000. 3 bedroom apartment with Piransky gulf view is for €200,000. House in Mestine built in 1960 is for €80,000.

6. Lithuania. Cheap and cheerful

The unknown Europe. 10 countries for the Russians | Photo 6 | ee24
The Vilnius Old Town

Lithuania is also interesting for the Russian customers primarily as a country offering a mechanism for obtaining a resident status and as one of the cheapest EU and Schengen countries. Lithuania is not the Russians favorite, and yet CIS buyers are more active here than investors from Western Europe.

Benefits. Located close to the Russian border. Russian language is widespread. When registering a legal entity in Lithuania, the immigration authorities are ready to provide a residence permit. However its annual extension requires you to show that the company is working and paying taxes.

Market. Investors pay attention to Vilnius, Klaipeda and Palanga – as places where you may lease apartment with profit. Prices decreased after the crisis, more than by 50%, but the market is currently restoring. The square meter price in capital and in resort area starts from €1,000 and sometimes reaches up to €8,000. At the same time across the country actively are offered ultra – economy options: houses and apartments from €10,000-20,000.

Current offers. An apartment of 70 square meters in Utena region is for €17,000. Apartments in Vilnius county area of 40 square meters in area is for €20,000. One bedroom apartment of 50 square meters in area in Vilnius is from €50,000.

7. Sweden. Kingdom of socialism

The unknown Europe. 10 countries for the Russians | Photo 7 | ee24
Kiruna

Country is unique, as bigger part of housing transactions passes outside the major cities. Experts believe their country market is undervalued and therefore attractive for investors.

Benefits. Sweden consistently receives first places in the top lists of countries with the most stable economy, high living standard, health care, etc. Even during the financial crisis, housing prices in Sweden remained almost unchanged. State regulation of the real estate sector prevents both rapid growth and fall as well.

Market. Stockholm and its suburbs, as well as Gothenburg and Malmo are popular among the small Russian investors. After the crisis, the average annual decline in prices varied from 2% up to 4.5%, compared to the changes in neighboring countries that illustrates an enviable stability.

Current offers. Price of two bedroom apartment in Stockholm center starts from €170,000. In luxury segment prices reach half a million euros. Private houses in the suburbs are from €250,000 up to € 1 million. Objects in the province are in 10-20 times cheaper. Option: a house of 176 square meters, in Nordmaling area, 50 km away from Umea on the Baltic Sea is for €27,500. Such a house in Stockholm region costs minimum €300,000.

8.Serbia. Young and interesting

The unknown Europe. 10 countries for the Russians | Photo 8 | ee24
Belgrade

Over fifteen years of peace the Serbs build up a society to live and do business comfortably. Serbia is one of the most promising and yet underestimated destinations in the overseas property market. It has everything for a great vacation: a mild climate, forests, lakes, rivers and spa springs. All but not the sea.

Benefits. Visa-free entry and low prices. Serbia has a favorable geographical position providing economic relations with other European countries – it is located on the Balkan Peninsula and borders on Croatia, Hungary, Romania, Bulgaria, Montenegro, Macedonia, Bosnia and Herzegovina.

Market. Serbian market in crisis behaved a bit abnormally: property prices in major cities have grown up from 2% to 10% until 2010. Land for construction grew in price even faster. Then prices started to decline. However, in 2012 Serbia formally became a candidate for EU membership, and an intake of economy investment appeared. Government directs its forces for tourism sector development.

Current offers. Houses near Belgrade and Novi Sad are from €30,000 to €60,000. Apartments in the old part of Belgrade cost €2,200-2,900 per sq. m. Apartments in new buildings in residential areas of Belgrade are for €1,300-1,500 per sq. m.

9. Poland. The descent charm

The unknown Europe. 10 countries for the Russians | Photo 9 | ee24
Warsaw

Plain agricultural landscapes are replaced by cozy houses without any architectural pretentiousness, and those by old towns with castles and stately churches. This is a typical east, west, north and south Poland picture. There is no exotic here, no hot sun or enthusiastic expectations regarding the tourist business development.

Benefits. Market is not intended for mass external customer and not speculative, rid of ups and downs. Experts say that smooth decline in prices after 2008 was primarily associated with local economic indicators.

Market. An apartment in Poland million cities may be purchased for €700-1,700 per sq.m. Province costs 3-4 times cheaper. Average price of a square in Warsaw is € 2,000. Apartments in the capital for €120,000-130,000 are in demand.

Current offers. One bedroom apartment in the area close to the Krakow costs from €60,000 up to €100,000. Similar options with the same price may be find in Wroclaw and Poznan. In towns like Augustow, Belostok, Lublin, Rzeszow, Dukla you may find offers from €25,000, but it is purely a domestic Polish market – offers in RuNet even don’t exist.

10. Iceland. Some like it hot

The unknown Europe. 10 countries for the Russians | Photo 10 | ee24

Iceland is among the five richest countries in the world and in the UN ranking it has third place for the life quality. Non-residents are allowed to purchase property without limitation; the purchase procedure is utterly simplified. Prices are high, transactions are rare.

Benefits. Reykjavik is the most environmentally friendly capital of the world as there is no heating and boilers but plumbing and heating system consists of hot water from geothermal sources. All houses are equipped with under-floor heating and even the central streets of the capital are heated with geyser waters.

Market. Even in Reykjavik, not to mention the Icelandic province dominates low-rise construction. Prices have fallen by 18-22% since 2008. Consultants advise to pay attention to the commercial areas, primarily in the tourist industry sphere. Hotel business is rapidly developing and the investment pays off enough quickly.

Current offers. Spacious apartment (150 square meters, living room and 4 bedrooms) in the center of Reykjavik is for €411,000. Apartment in new building in the capital costs from €220,000.

Text: Julia Lozovskaya, especially for ee24.com