Investors are moving into secondary cities

For luxury housing is not earn

1In the majority of the world’s major centers (London, Paris, Monaco) property premium falls in price. As a result, these objects lose their investment attractiveness. The strongest fall predictably showed Moscow, where, as recognized realtors, the last investment deal was still in 2014.

The past year was marked by a stagnation in the major global markets of premium real estate. According to the study Wealth Report 2016, conducted by an international company Knight Frank, the most expensive city was left Monaco last year, as in 2014, for $ 1 million here, you could buy only 17 square meters. m premium real estate. Hong Kong retained second place. There’s the past two years to $ 1 million, you can buy a 20 “squares.” However, in the closing three London house prices have already started to creep down. If in 2014 there is a $ 1 million could buy 21 square meters. m, then in 2014 – already 22 sq. m.

Most of the other major world centers have shown an even more drastic fall in prices. For example, in Los Angeles, according to a study in 2015, you could buy a $ 1 million 65 square meters. m, and in 2014 – only 57 sq. m. In Paris, the gap is even greater: 57 to 40 square meters. m the previous year. It is clear that the search suggestions to meet the $ 1 million in the first three cities, is almost impossible.

2“There are proposals in Monaco there, the average Russian ultrahayneta request – apartments with two or three bedrooms, with an area of ​​200 square meters. m, with sea views and close proximity to the beach, the average budget for the purchase – € 8-10 million, “- said Marina Kuzmina, director of the department of foreign real estate Knight Frank.

However, in London and New York, you can find a small-sized housing premium, she specified. But I have little to add. “For £ 1 million can buy a small studio in London in a new building in the business district of the City, as well as Westminster or on the south bank of the Thames – in building with concierge, parking and fitness facilities. These flats very quickly leased to businessmen and students, “- said Kuzmin.

Investors are moving into secondary cities

3According to experts, this year was marked by the fact that the high-end market of elite residential real estate began to lose its investment attractiveness. Most of the world’s centers do not show a constant growth in expensive housing prices, so to make money on real estate is almost impossible.

“Among the world’s cities, where markets are investigating experts Savills World Research, prices fell in London, Paris, Singapore, Dubai and Moscow. In all these cities, a niche occupied by international investors “, – says Paul Tostevin, deputy director of the Department of International Studies Savills.

Places where prices continue to rise, remain, but they are much smaller. First of all, this is New York. According to Savills, is an increase of 7.3% in 2015. Similar data are given in the report, Knight Frank: in 2014 it was possible to buy 34 square meters in New York. m of housing in the $ 1 million, and in 2015 – only 27 sq. m.

4“In 2015, in Sydney, it was marked by a rather high increase in prices for residential real estate premium (18.9%). Also, housing prices in this category in Hong Kong grew by 9.8% “, – adds Tostevin.

Nevertheless, he admits, in general investors are less interested in a house in the world’s major centers.

“While prices in some cities of the world at the moment are at a high stable level, we are witnessing a shift of interest of investors towards other cities, are not world centers. Madrid, Manchester, Barcelona and Chicago are becoming more and more attractive to foreign investors, “- describes the picture Tostevin.

As he points out, in search of higher yields, investors are starting to look at the “secondary” of the city, as well as alternative assets. Among European cities, which are also characteristic of this trend – Amsterdam, Oslo, Brussels and Berlin.

“Berlin – one of the most underrated cities in Europe. Especially popular are apartments in new buildings under construction, most of which apartments are sold even before they start to dig a pit, “- said Kuzmin.

In Berlin until you can afford the purchase of more than 90 square meters. m, but the situation is changing rapidly, given that only 2015 Berlin showed 9 percent growth, and it has been going on for several years.

Last seen investor in 2014

5Predictably, the most powerful pullback took place in Moscow. According to Knight Frank, could be bought in 2014 for $ 1 million 65 square meters in Moscow. m premium real estate. Now – 83 square meters. m.

Similar data leads and other market participants. Director of the Department of elite real estate company Est-a-Tet Anna Karpova noted that prices fell by 10-15% of the dollar value.

“The general trend of premium projects – increasing the value according to the stage of readiness, but a step increase was minimal – 2-3% twice a year. Unlike 2012-2013, when the increase reached 7-10%, “- she said.

As one Moscow realtors assert that the property is not in the Moscow investment potential.

6“It is necessary to speak about the preservation of capital, but the promise that in three years you will be able to implement today’s purchase twice as much, did not become one, those days are long gone. If the property is purchased in order to continue to rent, and here it is not necessary illusions, its payback period is not satisfied with any of the investor, “- describes the situation Deputy Director of sales of apartments Penny Lane Realty Victoria Balashov.

Ilya Menzhunov, director of real estate department of the company “Metrium Group”, says that the latest investment deal was in Moscow in 2014.

“To acquire an apartment with a view to resale, whether secondary or primary market, today it is extremely risky. For any investor interested “to get out of the deal” within 1-1.5 years. But given the high volatility of currencies and reduce no one can be sure of the demand that he be able to earn “- said the expert.

As told Menzhunov, many market players expect that Russian investors will replace the foreign, as taking into account the volatility of the currency Moscow real estate on display in rubles, are accessible to virtually doubled. However, contrary to expectations, no interest on the part of citizens of other countries are not observed.