The Russian and Ukrainian war
Limited impact on Spanish real estate, but with collateral damage.
Professionals agree that the impact of the war on the country’s real estate will be limited, although collateral damage will be impossible to avoid.
With a bleak scenario due to the conflict between Russia and Ukraine, the Spanish real estate market is at a time of many questions and few answers. How it will affect the investment and what impact it will have on the residential business are some of the issues that have been on the table for a week. The main real estate players consulted by idealista/news shed some light on so many questions, agreeing that the impact of the war on the country’s real estate will be limited, although it will be impossible to avoid collateral damage.
One of the great unknowns is whether the conflict will freeze Russian investment in the European space. According to Mikel Echavarren, the CEO of Colliers International in Spain, he believes so: “drastic limitations will be placed on Russian investment”. For the economist Gonzalo Bernardos, “what the sanctions of the European Union intend is to prevent rich billionaires from taking their money out of Russia and investing it in the European Union, therefore, their real estate investment will practically disappear.”
Investment coming directly from Russia “will be impeded by Western sanctions, even more so if the country is expelled from the SWIFT interbank payment system. Even if it resorted to alternative mechanisms such as the SPFS or the CIPS, these are not directly linked to the European space, so the costs and deadlines would increase, apart from the fact that they would continue to be controlled as coming from Russia”.