A couple look in the window of Savills estate agents
(Picture: Alamy Stock Photo)The loss of Russian buyers from the London property market won’t have a big impact, according to Savills.
CEO Mark Ridley said Russian buyers were a “tiny proportion” of the market. The company’s own figures suggest just 1.4% of central London is Russian-owned.
Sanctions imposed in response to the invasion of Ukraine have now made it very difficult for wealthy Russians to purchase property in the capital. It has led to fears of a downturn at the top of the market, where oligarchs have made headlines for buying showpiece houses. The Wall Street Journal this week claimed the effective ban “put pressure on the UK property market”.
Ridley said domestic and Asian buyers were much more important to London’s so-called “ultra prime” property market.
“[Russian buyers] haven’t been a big part of the market for years,” he said. “They never were a massive part.”
Under 0.1% of Savills sales come from Russians, the company said. It has suspended a franchise agreement with an estate agency based in Moscow.
Ridley’s comments came as Savills reported record sales and profits for the year just gone. The property giant — which does everything from consultancy and sales to property management— saw revenue rise 23% to £2.1 billion. Profits more than doubled to £183 million.
Savills enjoyed strength across most of the business, with particularly strong demand for commercial property and houses in the UK. Demand for warehouse and logistics space has been “phenomenal”, Ridley said.
The group announced dividends totalling 55.4p for the year, including a special dividend meant to make up for a cancelled payout at the start of the pandemic. Ridley called it “a thank you to shareholders who supported us”.
The property market is likely to “normalise” this year as the pent-up demand seen last year begins to ebb. Ridley said it was “too early to predict the economic, including longer-term inflationary, impact of the Ukrainian crisis on the world’s real estate markets”.
Savills’ stock gained 60p to 1200p.
