Faced with the war in Ukraine, the European Union has decided to impose economic sanctions on Russia. Thus, it has, among other things, excluded seven Russian banks from Swift, this financial system allowing banks to exchange internationally. A direct consequence on the Côte d’Azur, especially on real estate and not only for the oligarchs.
Cyril Messika, president of the Housing Real Estate Observatory, comments: “Russian customers can no longer pay their rent because of this blockage. The territory is a land of welcome for the Russian community, and not just for billionaires. We suffer from this situation without being able to do anything. We must react quickly because it is not anecdotal. He adds: “The urgency is on the additional cost of materials, due to the boycotts, and which increase the bills by more than 30%. We are facing a real problem. »
Deadlines that go “from 4 to 6 weeks to 5 to 4 months”
Indeed, to exert more pressure and put an end to the war, the European Union has stepped up its measures against Russia. On March 15, she notably introduced a “fourth train” including trade restrictions on iron, steel and luxury goods. Here again, real estate on the Côte d’Azur is affected.
Patrick Moulard, president of the Federation of buildings and public works (BTP) of the Alpes-Maritimes develops: “There is an additional cost of all the raw materials and that has direct repercussions on the constructions. We have gone from a period of 4 to 6 weeks to 4 to 5 months for the manufacture of an electrical panel. Today, outgoing projects can no longer be done, there are postponements of construction sites. Not all clients agree to pay these additional costs. We then expect a real brake on our activity because we know that there will be no changes for several months, even several years. »
For him, the situation is “no way out”. “Even if we want to do otherwise, there are limits. Especially in our territory which is constrained to a particular regulation of seismic construction. It forces us to use a lot more steel compared to other territories. Before the crisis in Ukraine, the ton was at 600 euros, today it is at 1,800 euros. How can we project ourselves into the future with a price which is multiplied by three and which will change almost from day to day? »
Russians can’t buy anymore, but Ukrainians can
To all these problems is added that of the Russian market which is disappearing from real estate agencies. “Three acquisitions were stopped because my Russian clients were unable to release the funds,” explains Alban Leloup of Masséna Immobilier in Nice. Even if it’s not my main clientele, it’s still good transactions, with properties between 500,000 and 800,000 euros. On the Côte d’Azur, these customers had taken up this top-of-the-range position for several years. “A category that can go up to 4 million euros for a property.
It is one of the targets of Laurent Merengone of the Gubernatis real estate agency. He then noticed that “many Russians want to rent their villa when they bought it not so long ago. Others are even forced to sell thinking they are anticipating new restrictions or simply because they can no longer come here. Hence the importance of diversifying your clientele. I saw an email from an agency specializing in luxury which mainly deals with Russian speakers and which is now offering offers with a 20% discount. »
And one customer chases the other. “I have just signed a 3-room apartment in the golden square in Nice, at 700,000 euros with a Ukrainian client, continues the real estate agent. And I also have requests for rentals this summer from CSP+. Affluent people seek to stay on the Côte d’Azur. This is a new phenomenon that I did not expect at all. »
But for Ukrainians with fewer means, “it’s more complicated,” says Moïse Vergeot, president of the Orpi Côte d’Azur group. “It’s not easy to find guarantors for donors, there is no tax revenue. It is then necessary to try to have savings available. The situation is not simple on that side either. »