Selling an apartment in Moscow

[Steamer]

Steamer, it is a well populated and growing suburban area of Moscow. That is like saying that Orange County is not a major factor just because it sits in the shadow of Los Angeles. I travel areas like this frequently and they are a popular alternative to the crowded inner city of Moscow.

It's still a long way away from the center. Some people would call that being out in the "sticks".

[Faux Pas]

It's still a long way away from the center. Some people would call that being out in the "sticks".

Not less than 5 years ago you couldn't touch an old Soviet style apartment in the same area for $50K and it is still Moscow even if it is out and far away from the center. Moscow is a big place

[Chicagoguy]

Mendy, I imagine you are correct. I was always with my wife or a relative. No time for longer exposure to the locals. Plus as I am older and can sometimes use a cane so I might not be such an inviting target.

I will still return yearly though. I still like the Russians if not the country [ Putin ]. It was my 17th visit since beginning in 1992.

[Steamer]

Not less than 5 years ago you couldn't touch an old Soviet style apartment in the same area for $50K and it is still Moscow even if it is out and far away from the center. Moscow is a big place

OK, however flats are still cheaper the further you get away from the  center of Moscow. When you have to take a bus to get to a Metro station it's not very convenient. Sure you can drive for over an hour through Moscow traffic to take care of your business or go to work but that sucks and it is reflected in housing prices.

[Faux Pas]

OK, however flats are still cheaper the further you get away from the  center of Moscow. When you have to take a bus to get to a Metro station it's not very convenient. Sure you can drive for over an hour through Moscow traffic to take care of your business or go to work but that sucks and it is reflected in housing prices.

But that's not a lot different than most major metro areas in the world. Farther from the center, the cheaper the real estate (usually). Moscow was just a year ago still one of the most expensive cities to live in the world and even in a down real estate economy, it still is. That is a result of the unavailable lenders and the restricted cash flow. Although since the sanctions it's likely fell considerably down the list.

My point being, $50K is a helleva deal for such a nice apartment in Moscow even if it comes with some inconveniences

[tfcrew]

http://www.bankrate.com/finance/taxes/selling-property-in-a-foreign-country.aspx


 

One thing...that site doesn't provide any IRS links.
I can't find any IRS info because they are so vague [only the 1116].
Tax prepares just automatically use Form 1116.

 

[Steamer]

My point being, $50K is a helleva deal for such a nice apartment in Moscow even if it comes with some inconveniences

The point I'm making is this is OUTSIDE of Moscow, WAY outside and that is why it's so cheap.
This is the ONLY point I'm trying to make.

[Boethius]

I don't think the point was that the property was so cheap but rather, how much it has dropped.  Apartment prices in the outlying areas of Moscow have collapsed.

[mendeleyev]

The point I'm making is this is OUTSIDE of Moscow, WAY outside and that is why it's so cheap.

Steamer, I will respectfully disagree with you on this, my friend. As Moscow has grown, this is no longer so far outside Moscow that it is not considered to be a proper suburb. That is why Metro stations are planned with locations already being discussed.

I could have easily pointed to two properties which my wife and I own, completely in the centre. Those have plunged to less than half their 2011 value for instance. I chose this example for several reasons, one in that it illustrates the fact that Russians are much more willing to live further from the centre in order to achieve certain lifestyle amenities. Golf access, on-site fitness facilities, larger rooms, etc, are attractive to young families and pensioners who want more than just an "address."

The other reason is to show an across the board plunge in real estate values.

Frankly, if it was necessary to purchase a home, I'd rather be there with those lifestyle options than in some run down old and aging property that will likely need to be demolished in my lifetime. I have a close journalist friend, ethnic Russian, who is stuck with such a place right now. It is less than a minute walk from Metro Fili, a one room flat that was remodeled about 7-8 years ago.

I have been in his home many times and the bathroom is nice, the kitchen outfitted with IKEA appliances, remodeled to an open floor plan, and it has a nice balcony. But, the building is old (Stalin period) and while near parks and shopping, these older buildings just do not have the same appeal to modern Russians. He says that the last two sales in his building have brought in less than $10K each. The building is less than 60% occupied as older residents have died but there is no interest by younger buyers.

[sleepycat]

Mendy, 2 years ago when I visited St. Petersburg I saw many fancy apartments on Krestovsky Island.
Do you know roughly how much an apartment on that island will sell for?

[Steamer]

Steamer, I will respectfully disagree with you on this, my friend. As Moscow has grown, this is no longer so far outside Moscow that it is not considered to be a proper suburb. That is why Metro stations are planned with locations already being discussed.

I could have easily pointed to two properties which my wife and I own, completely in the centre. Those have plunged to less than half their 2011 value for instance. I chose this example for several reasons, one in that it illustrates the fact that Russians are much more willing to live further from the centre in order to achieve certain lifestyle amenities. Golf access, on-site fitness facilities, larger rooms, etc, are attractive to young families and pensioners who want more than just an "address."

The other reason is to show an across the board plunge in real estate values.

Frankly, if it was necessary to purchase a home, I'd rather be there with those lifestyle options than in some run down old and aging property that will likely need to be demolished in my lifetime. I have a close journalist friend, ethnic Russian, who is stuck with such a place right now. It is less than a minute walk from Metro Fili, a one room flat that was remodeled about 7-8 years ago.

I have been in his home many times and the bathroom is nice, the kitchen outfitted with IKEA appliances, remodeled to an open floor plan, and it has a nice balcony. But, the building is old (Stalin period) and while near parks and shopping, these older buildings just do not have the same appeal to modern Russians. He says that the last two sales in his building have brought in less than $10K each. The building is less than 60% occupied as older residents have died but there is no interest by younger buyers.

Ok

[Anotherkiwi]

Mendy, 2 years ago when I visited St. Petersburg I saw many fancy apartments on Krestovsky Island.
Do you know roughly how much an apartment on that island will sell for?

When I was last there (2010) I was told that most of the good waterfront apartments cost the equivalent of a million dollars (that's on both Krestovsky and Vasilievski Islands).  How any "ordinary" Russian could afford that beggars belief.  There are so many, however, that SOMEBODY must have made a killing (quite literally in some cases, I would imagine).

What they're worth now would be anybody's guess, but I can't see that the values would have increased much.