Buy Property in Russia

The Civil Code governs the sale and purchase of real estate in Russia.

Under this law, foreign citizens are subject to certain restrictions related to the ownership of specific properties; however, if they decide to sell property in Russia, there are no such restrictions.

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Buy land in Russia

In Russia, there are two main types of rights on real estate: the ownership right (possessing, using, and selling of the property) and the lease right (possessing and using the estate according to the terms agreed with the landlord). 

Should you need legal guidance, counseling, and further details on how to sell a property in this countryour Russian lawyers can help you with all the documents and procedures needed to complete the transaction.

Foreign or Russian citizens deciding to sell the real estate property in this country can benefit from legal assistance offered by our law firm in preparing the documents related to such a transaction. Our lawyers in Russia  specialize in providing a wide variety of legal services, including guidance in starting a business for foreign entrepreneurs.

According to the Civil Code, there are several ways can acquire ownership over real estate. When selling a property in Russia , the owner needs to know their rights over the property. The following types of ownership rights are acknowledged in Russia :

  • – land plots or real estate properties that have been inherited by the current owners, which can sell without any legal problem;
  • – mortgaged properties that cannot be sold without prior notification to the bank and the person to buy the real estate.

In the latter situation, the buyer will be required to assume the mortgage over the property. However, it is good to know that mortgaged property sales are infrequent in Russia .

The selection criteria in Russia do not usually include a property’s physical condition, as in most cases, buyers prefer doing their renovations and arrangements. However, other sale conditions are seen as more important, namely the legal aspects of the property and the completeness of the paperwork (done by the seller). For example, if you have inherited the estate, you should register the title before selling it. If you have Russian relatives registered on your property, you should write them at another address, thus putting it on the market free of third-party rights.

The owner of a Russian property is not required to complete any specific steps when selling unless they want to. One can advertise the sale of the respective property on specialized websites or with real estate agencies.

When preparing the sale of real estate, the proprietor must ensure that:

  • – they have all the documents which need to be presented during the transaction;
  • – they are the owners of the properties – the property deed must bear their name;
  • – they draft a pre-sale or directly a sale-purchase agreement with the buyer;
  • – they have paid all the taxes related to owning a property, according to the Russian law;
  • – they provide all the documents the buyer will need to register the property in their name.

It is also essential to know that the property seller has the right to verify the person or company when selling real estate in Russia. Our law firm in Russia can ensure the real estate due to diligence procedure on behalf of sellers and buyers.

The sale of commercial properties in Russia is quite common. Many foreign companies setting up operations here are also interested in acquiring office buildings or land plots to carry out their functions. While there are certain restrictions related to purchasing land plots in certain areas, the purchase of private-owned commercial real estate is permitted.

It is important to note that the sale of commercial real estate will imply a thorough verification of the buyer and assistance from a law firm in Russia.

Another aspect to consider is that commercial real estate sales can be part of an acquisition deal for an entire business, a case in which specific clauses apply. Our attorneys in Russia can guide local companies interested in selling real estate as part of an acquisition deal by complying with the legislation in this sense.

Both the seller and the buyer need to prepare a set of documents when completing a real estate transaction. This set of documents must comprise:

  • – the identification papers (ID or valid passports) of both the seller and the buyer;
  • – the sale-purchase agreement, which both the seller and buyer must sign;
  • – the property title which the seller must bring upon the completion of the transaction;
  • – a power of attorney, if one of the parties has enabled a third person to complete the transaction on their behalf;
  • – the mortgage holder’s consent if the property is subject to a mortgage.

Our Russian lawyers can help the seller prepare the documents when such a transaction is completed. We can also offer representation during the transaction if the property owner is not in the country. We only need a power of attorney to represent them.

Once the transaction is completed, we can also ensure the former owner no longer appears in the Land Register’s records to avoid paying additional taxes.

The video below presents the main steps required to sell the real estate property in Russia :

Must register the sale-purchase contract with the State Registrar for the Property Rights and Deals. There are two kinds of registration in Russia:

  • – the expedited registration (which can take up to two weeks); a fee has to be paid per entry, and if the purchased property is a building that has land, a separate price is necessary for registering the ground as well;
  • – the usual registration (which takes up to four weeks). 

The sale transaction usually takes place in a bank. The seller and the buyer execute a preliminary contract, describing all the conditions of the deal that is about to be closed and stating the list of documents that have to be provided by the seller. After the payment, both have to sign the agreement before a notary or realtor. You can ask our attorneys in Russia for more information or advice on issues related to selling a property or other legal matters.

The tax rates depend on the tax residency of the vendor. Typically, persons who exceed 183 days per year in the Russian Federation are seen as tax residents, and the tax rate is 13%. These sellers have to pay taxes on the capital gains. In the case of owning a property for more than three years, the vendor is exempt from all taxes. For non-residents, there are no tax exemptions, and they have to pay 30% on the sale proceeds.

If you are searching for professional legal assistance, feel free to contact our lawyers in Russia. We can help both the seller and the buyer complete any residential or commercial real estate-related transaction. However, you can also rely on us for assistance in other legal matters, such as starting a company in Russia.

Related: Open a llc company in Russia

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