Russian residential property purchases contributed an estimated £190 million in market value and £13.2 million in stamp duty tax in 2021, it has been revealed.
Some 82,305 residential property sales (Type A) took place across the London market last year to the tune of £55.7 billion in market value, while homebuyers paid out £3.7 billion in stamp duty tax.
In addition to these primary purchases, a further 13,016 transactions took place for additional purchases such as second homes and buy-to-let investments (Type B).
International buyers
It’s thought that approximately 30 per cent of this market activity was attributed to international buyers, with Russian buyers accounting for 1 per cent of all market activity.
This means that Russian buyers accounted for an estimated 247 primary residential property purchase across the London market in 2021, with a total market value of £167 million, paying just over £11 million in stamp duty tax in the process.
Benham and Reeves also estimates that Russian buyers accounted for approximately 39 Type B transactions at a market value of £22.8 million, paying £2.2 million in stamp duty tax at the higher rate for this type of purchase.
In total, some 286 London properties were sold to Russian buyers in 2021, sitting just shy of £190 million in market value and netting the government almost £13.3 million in stamp duty tax.
Increase in Russian ownership
Director of Benham and Reeves, Marc von Grundherr, commented: “Russian activity has long contributed to the overall health of the London property market, with might of the Ruble traditionally prevalent within prime London neighbourhoods.
“However, Russian buyer activity still only accounts for a very marginal proportion of market activity and so while the swift implementation of economic sanctions against Russia may have a knock on effect here in the capital, they certainly won’t spur a market decline of any sorts.
“In fact, while the expectation is that this segment of international buyers will now dwindle as assets are frozen and the Iron Curtain falls once again, the likelihood is that we may actually see an increase in Russian ownership.
“The London market has always been a safe haven in times of crisis and with many looking to flee a free falling Russian economy, there’s a very good chance London will be their destination of choice.”
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