Hi Everyone,

Recently we e-talked with Angelica Krjukova, Russian real estate agent and teacher for new Russian specialists in international real estate from St. Petersburg, Russia.

Here's what she wants to share with us:

"International real estate market in Russia and particularly in St. Petersburg, the second largest Russian city, is rather young. It is more developed in Moscow, the capital, then in other cities. At the same time there are no real estate agencies selling international properties to Russian buyers in some large provincial cities in Russia yet. It is actually since 2008 that Russians have become such international properties buying power that many companies from all over the world got interested in Russian buyers and investors.

"Domestic real estate in Moscow and St. Petersburg was the most expensive in the world at that time. Take into consideration the unstable economy in Russia, too. So, those Russians who could afford a second home for their family started buying international properties in huge numbers under such circumstances.

"One could buy a large luxury apartment in Bulgaria, UAE or Turkey for a price of the cheapest and poorest property in Moscow or St. Petersburg at that time.

"Russians started and continue looking across borders for better properties for the same money.

"In 2009, for a price of a 1-bedroom apartment in Moscow one could buy a 3-bedroom in Bulgaria or a 2-bedroom in Tenerife, Spain.

"In St. Petersburg, potential buyers of international properties who were financially capable and willing to acquire real estate in other countries, had a problem sometimes – where and whom to turn to for high quality advice in international real estate?

"At the beginning of this trend of Russian real estate buyers going internationally there were just a few of Russian brokers offering international services and often they didn't really have any proper qualification for that.

"There was no educational institution to teach brokers this profession, no teachers and no professional standards. Specialists were self-taught. Nowadays the situation started to change slowly, though there are no professional standards in international real estate brokerage in Russia yet.

"As of today there are the following types of real estate agencies in St. Petersburg, Russia that are working with international real estate:

1. Russian real estate agencies that are experienced in domestic market and started international real estate departments as well. They work for Russian buyers fulfilling buyers' individual requests for properties in any country. Usually these agents do not have enough knowledge of the laws of the countries they sell properties in. As an example, they prefer to tell potential buyers that as soon as the buyer becomes a property owner in a foreign country he or she would automatically get residency rights in that country, but this is not the case in many countries... These agents do not know the language of the country they are selling properties in – this is the easiest thing to fix with a translator's help, but what is more important they don't know the legalities of property transfers and real estate contracts in those countries either. Some of these agents never visited countries they sell properties in. They just show their Russian clients glossy magazines advertising the properties in various countries. Often they find the information on properties their clients required just on the Internet, without any checking or confirmation. They sell properties as merchandise at a store without any further responsibilities to their clients. If their Russian client encountered a problem in a foreign country, the client is on his or her own... We should not think that these agents are dishonest, no; they just lack the knowledge...

2. Russian offices of foreign companies. They are usually located in Moscow, although many European real estate agencies open offices in St. Petersburg too. The leading international real estate companies start offices in Russia with Russian-speaking staff to be readily available for their Russian clients. It's so important for a Russian buyer to understand each word in the real estate contract and also be able to talk about his needs and wants in his own language. A happy client will refer his friends and co-workers to the same real estate agency. It's not a secret that referrals are the best part of real estate business.

3. Russian travel agencies start international real estate departments too. They organize group tours to buy real estate in a foreign country. As they have no experience in real estate whatsoever, many things can go wrong for the group willing to buy properties abroad: in-country agents without licence, developments that will be never completed, properties built without proper legal permissions, etc.

4. Russian real estate agencies that started with the goal of selling international properties. They usually have an in-house lawyer and offer their clients a well-developed contract on legal help in buying international properties and post-sale management services."

P.S. There are about 30 to 40 real estate agencies in St. Petersburg dealing with international real estate now, Angelica says.

To your best business success,

Sincerely,