They were never in the majority, but their presence was always blessed by the real estate sector on the Costa del Sol. The Russians have been among the best clients for years. They were looking for the best houses on the beachfront or in the mountains. They wanted large halls, large rooms, lots of light, an indoor pool and a gym. And they always paid well. Now, after the invasion of Ukraine and the international sanctions against his country, his presence has practically disappeared in the golden triangle of Malaga formed by Marbella, Estepona and Benahavís. “Operations have dropped to a minimum,” says Kristina Szekely, head of the luxury agency that bears her name. “Their demand has almost completely disappeared,” they add from the Association of Entrepreneurs for High-Quality Housing DOM3, where they stress that the Russians are now a seller’s group in search of liquidity and that they have been replaced by other markets such as the Polish one.
The pandemic has caused a revolution in the luxury real estate market on the Costa del Sol. The confinement reminded the great fortunes of what the Malaga coast offered. And they valued more classic factors such as the good weather or the proximity of Malaga airport —which lost its four weekly connections with Moscow due to the war— and the many private services offered by the area, from schools and clinics to golf courses. The last two years have been the best in the history of the luxury market in the area, according to the unanimous opinion of the sector, but Russian citizens have disappeared from that equation. The armed conflict and the measures promoted to sanction Russia have taken their toll. “They continue to buy, but now much less,” says Jimmy Widen, founder of the 3SA Estate agency.
They know it well in the most exclusive urbanization in Europe, La Zagaleta, a few minutes north of Marbella and which houses some of the most luxurious villas, with prices exceeding 30 million euros. According to its general director, Jacobo Cestino, after the invasion there have been no acquisitions of real estate or land in the compound by people from that country. “We have not even received contacts from Russian investors or intermediaries on their behalf interested in properties,” adds Cestino, who believes that it is due to the strict controls they impose on client assets. The head of this privileged corner insists that the demand for luxury housing by Russian citizens “is now practically residual.” Industry sources explain that the few people who have bought in the last year are residents of European countries or others such as Dubai, but there are also those who move money so that it reaches Spain from countries such as Azerbaijan or Turkey. In 2022 —the latest data available— residing in Malaga was slightly more than 8,300 Russian citizens, a thousand more than the previous year. The majority —2,481— live in Marbella, where there are everything from the media to Russian schools and “For Sale” signs in the Cyrillic alphabet.
The 2023 Marbella Real Estate Market Report prepared by Diana Morales Properties reflects that traffic from Russia on its website had increased by 105% at the end of 2021 compared to the previous year, but also that after the war, demand has stopped dead. on the Malaga coast. If already in Spain only two out of every hundred acquisitions by foreigners corresponded to Russians in 2022 —a figure that rose to 3% in the first quarter of this year, according to the Association of Registrars—, its role on the Costa del Sol is now hardly relevant and close to 1%. Low numbers in a market, Malaga, where according to the registration body, one in three homes is bought by foreigners. Especially from the UK (16%) and Sweden (12%). The Netherlands (8%) has become the third most important origin. Another study, that of Panorama Properties, already reflected last year that Russian purchasing power is “very limited”. “The sanctions, together with the difficulty or impossibility of opening bank accounts for non-resident Russians, have further reduced this sector of the market,” says Christopher Clover, head of this luxury real estate agency, which opened its doors in 1970 and whose offices are located in Puente Romano, in the heart of Marbella’s Golden Mile, close to the luxury of Puerto Banús and the history of the Marbella Club Hotel.
‘Golden visa’
A square meter can reach 25,000 euros in the area, one of the favorites for Russian citizens, most with the profile of businessmen with large checking accounts, far from the oligarch stereotype. “They have always looked for the best: either on the beachfront or on the mountain with the best view. They like the good. But in the last year I haven’t had a single client from there”, says Kristina Szekely. Nueva Andalucía or La Quinta have also been preferred areas for these citizens, who, in addition, could acquire the golden visa when buying houses of more than 500,000 euros, as 806 people from the Eurasian giant did between 2013 and 2019.
Marbella, however, does not miss them. Its brand has become one of the most important in Europe for second homes and, after the pandemic, also for the first. The fall of the Russian market has also been accompanied by the increase of other citizens who have taken their place, especially from countries bordering Russia or Ukraine who are seeking safety. “Especially from Poland”, they say in the DOM3 association, but also from other places such as Lithuania, Latvia, Estonia or Romania, according to data from Panorama Properties. “While in other cities in northern and central Europe the recession as a result of the Russian invasion of Ukraine and the rise in interest rates (among other events) has begun to take its toll, Marbella has come out stronger, showing growth figures well above those of its competitors”, underlined from Diana Morala Properties.
.Economy and Business in Facebook and Twitteror in our weekly newsletter
.
., ..
.
