Russian citizens living in Finland have been purchasing houses and vacation cottages at bargain prices, according to an Yle investigation.
The reason for this is that Russians living in Russia are selling off their properties in areas like Savonlinna because the sanctions have made it nearly impossible for them to maintain and use these places. The eastern border closure and banking suspension have contributed to a growing number of Russians selling their properties in Finland.
Nearly half of the properties purchased by Russian citizens this year sold for less than 30,000 euros. Often these properties were classed as old or even dilapidated.
Typically the buyer is a Russian individual living in Finland, while the seller is usually a Russian residing in St Petersburg or elsewhere in Russia.
The Ministry of Defence reviews all real estate transactions involving individuals from outside the EU and EEA countries. Joonas Laito, an expert from the ministry's real estate unit, said that nowadays nearly all Russian citizens buying property in Finland are already living in the country.
At the same time, property purchases by Russians living in Russia have come to a halt, according to the ministry.
Helmi Manninen, a Lappeenranta-based realtor, said the southeastern border area was previously a sought-after vacation spot for Russians wanting a weekend getaway.
She said the main appeal was the proximity to the border. These cottage-goers were attracted to Finnish nature, including mushroom and berry picking. They were not too bothered by the condition of these houses, she explained.
Now many of these owners can't unload their cottages quickly enough.
"There are now more sellers than buyers. For Russians living abroad, transactions in Finland now require wealth, patience and time," she explained.
Deals for locals
While Russians in Russia are under pressure to rid themselves of their properties in Finland, the situation has opened up opportunities for Russians living here.
Markku Kangaspuro, a Russia expert at the University of Helsinki, said sellers residing in Russia are squeezed.
"Many Russians living in Finland have seized the opportunity to make advantageous deals," Kangaspuro said.
For sellers, it may also be easier to deal with buyers who speak the same language.
Real estate agent Manninen noted that Russian sellers must have a bank account outside of Russia, which often limits sales to those with means.
"If someone makes a payment to an owner in Russia, it implies that the owner must have funds or convertible assets in Russia," Kangaspuro explained, adding that exchanges were another option.
"A property owner in Russia can exchange a home in Finland for an older, sometimes even dilapidated, apartment or studio in Russia owned by a Russian resident living in Finland," he said.
The Finnish Ministry of Defence has said it is preparing draft legislation which could place a total ban on Russian citizens buying real estate in Finland, according to Defence Minister Antti Häkkänen (NCP).