Russian property buyers and real estate funds are returning to the New York real estate market reports The Moscow Times. Although New York City's real estate prices may fall in the short term, analysts say Russian buyers view the city's property as a long-term and low-risk investment with a promise of U.S. dollar earnings. Russians are notoriously wary of putting their money in domestic banks since the 1998 banking crisis resulted in huge losses for investors.The trend is no doubt influenced by high-profile Russians investing in the city. The country's richest man, Mikhail Prokhorov, is among those leading the way after reaching a $200 million deal to buy an 80 percent share in the New Jersey Nets basketball team.The National Association of Realtors reported that U.S. Realtors saw fewer foreign buyers in the 12 months to May 2009, but the recent anecdotal evidence from Florida suggests the future trend maybe upwards.Irina Levieva, a broker at the Ostrov Realty Group, said a year ago "foreign buyers had disappeared" but now they are expressing interest and buying properties againWilbur Gonzalez, an agent at Brown Harris Stevens, said the Russians' quick return to New York property was unexpected. "I expected the Russians to sit out 2009 and 2010, licking their wounds," Gonzalez said.Gonzalez said he has recently shown a $45 million property to three potential Russian buyers and signed an almost $20 million deal with an unnamed Russian buyer for another property.Real estate funds are also keen to get in on the action. "I've been contacted by one of the largest Russian real estate investment funds. They don't want to build, they want to invest," says Levieva.Foreign buyers appear to be investing for the longer term as prices in the city are currently falling in many areas. The average price per square foot of Manhattan residential real estate fell 16.5 percent in the third quarter compared with last year, according to Miller Samuel appraisers.
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