Russia is the biggest country in the world, so there are many options for purchasing real estate. Foreigners have the same rights as Russians when buying real estate, but the Russian laws are sometimes complicated and the process involves bureaucracy. Keep in mind that in Russia, 95% of all transactions are done in cash, so that is the form of money you should have available.
Attorneys and Real Estate Agents
You should hire an attorney when you are buying real estate in Russia. This attorney should be well versed, if not concentrated, in Russian real estate laws, because they are hard to understand. Russian real estate agents can refer you to attorneys, but they might be biased to the interests of the agents. Your attorney should be fluent in Russian, because you’ll have to get some of your personal documents translated into Russian.
You should also find a good real estate agent. They will be aware of certain trends in the current real estate market system, and help you research what type of property is best for you.
You will need a notary public when you sign legal documents. You must also set up a safe in a bank to make transactions (see below), so you will have to interact with bank representatives.
Rules, Regulations and Restrictions
There are no special rules that restrict foreigners from owning property in Russia. However, you must present certain documents before you purchase anything. These documents include your passport and a visa. You must present a Russian translation of your passport, notarized. If you are married, you must also present a marriage license, and another copy of it translated into Russian and notarized. Your attorney will help you with this process.
If you reside in Russia for 182 days and over, you are considered a resident of Russia. This means that you will be taxed on your rental income at a rate of 13%. If you reside in Russia for less than this, you have to pay a non residential income tax, which is 30% of your rental income.
The first step in buying real estate in Russia is to make an offer on a place and have it settled. It is not necessary, or common, to have this property surveyed or inspected. That measure is up to your own judgment, but can be a good idea, especially if you’re purchasing and older property.
You must then sign a contract with a real estate agency. You’ll have to put down a deposit to secure the contract. Afterwards, the real estate agency must make a down payment and take care of some other bureaucratic measures, such as inspecting documents and titles of the property. If they find that the legal documents are faulty, you will get your deposit back.
When the exact transaction date is fixed, you should be prepared to make a down payment in cash. It will usually be deposited in a safe in a bank, only accessible to the buyer, seller and their legal representatives. The buyer and seller have to set up a contract with the bank to secure these transactions.
After you have all of the bank and cash processes completed, you and the seller must sign the main purchase contract at a notary’s office. These documents must be forwarded to the state registry. You must then pay a notary fee and a state registry fee. It takes about two weeks for this department to clear everything, and then send you documents that you legally own the property.