Russians' real estate preference shifts from Turkey to Dubai
While real estate in Turkey's tourism regions was in high demand by Russian vacationers, this rate decreased in 2024. Price increases play a significant role among the reasons for the decline. Along with rising prices, Russians have begun to prefer Dubai for real estate purchases.
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While Turkey was the leader in Russian demand for overseas real estate for several years, it lost this popularity in 2024. According to experts speaking to Forbes, real estate demand in Turkey has decreased by 27.5%. Reasons for this decline include price increases and the rise in the threshold for participation in the citizenship program. Although Turkey remained among the top 10 countries where Russians purchased real estate in the January-June 2024 period, demand fell by 36% compared to last year.
The second most popular country for Russians, the United Arab Emirates, particularly Dubai, is also experiencing a shift. According to Forbes data, demand for real estate sales in Dubai increased by 61% in the first half of 2024. Investors are increasingly turning to the secondary market and commercial real estate. Additionally, the trend known as "fix-flipping," which involves buying second-hand real estate, renovating it, and selling it, is also on the rise.
DEMAND FOR REAL ESTATE CONTINUES TO INCREASE
Beyond Turkey and Dubai, Russian investors are showing renewed interest in Europe. Demand for real estate in Europe is increasing in 2024. Russians looking to invest, particularly in countries like France, Spain, and Cyprus, are aiming to obtain European Union residency permits. However, the potential return on investment is now becoming more important than the residency permit itself.
Southeast Asia has become the most popular region for Russian investors. Between January and March 2024, Russians purchased 9,300 properties in Thailand. Bali in Indonesia and Vietnam are also seeing increased interest. Real estate investments in Thailand range on average between 150 thousand dollars and 400 thousand dollars, offering attractive and affordable options.
72 PERCENT OF PURCHASES ARE FOR INVESTMENT PURPOSES
In 2024, amateur investors in the overseas real estate market have been replaced by more experienced professional investors with larger budgets. Experts speaking to Forbes state that more conscious and pragmatic approaches are now being displayed in the market. Amateur investors are acting more by prioritizing investment returns.
In other words, Russian investors are now turning to real estate purchases for investment purposes rather than to obtain residency or citizenship. For example, while 72% of purchases made in the United Arab Emirates are carried out for investment purposes, purchases for personal use have fallen to 28%. This situation shows that investment projects and volatile markets are attracting interest in the real estate sector.