F.A.Q.

Modern real estate market in Saint-Petersburg has a certain need for high-quality apartments as at the moment the number of decent apartments is limited. This causes the increase of rent for these flats.

Even with all the obvious advantages of investing in real estate, it should be taken into consideration that not every apartment will be in demand in real estate market. According to standard requirements for renting an elite apartment the most attractive apartment is the one that fits European standards, combining functional layout, decorated with high quality materials and equipped up-to-date.

Location

The most popular districts among foreigners are the central ones: the zone of the "golden triangle", green area around the Tauride Garden, Krestovsky or Kamenny islands.

Examples of elite residential housing  in St. Petersburg are club house «Le Grand» at 152, Nevsky prospect, the houses located at 1, Fontanka Embankment, 12 Italianskaya Str, 4 Bolshaya Morskaya Str. Among the most vivid examples of luxury housing are residential complexes "Kamennostrovskaya kollektsia", the house at Shpalernaya Str, 60 and residential buildings on Krestovsky and Kamenny island: "Novaya Zvezda», «OMEGA House», Krestovsky Palace, «Dom u morya".

Special attention is paid to neighborhood area of special international schools, in particular: Anglo-American school in Petrogradsky district, private international school Atlantic in Primorsky district, Montessori educational center in Vasileostrovsky district, etc.

Types of residential houses

Luxury apartments for rent are in demand in the following types of buildings:

1. Modern residential complexes with good security and high-quality maintenance, good infrastructure, protected local area and underground parking.

2. Reconstructed historical buildings with modern engineering systems and security.

3. Historical buildings and other houses of the Stalin era, characterized by high ceilings, thick walls and unique architecture.

An important requirement for luxury apartments is the entrance lobby. Potential tenants expect the entrance to be clean, neat and bright and to be protected by the guards/concierge.

It should be noted that the safety level of the residential complex is of great importance to potential tenants. The territory of the building should have professional guards, videomonitoring, alarm system.

Floor plan

At the moment real estate market in Saint-Petersburg suffers from the lack of apartments with a large (more than three) number of bedrooms. These apartments are always in great demand.

Usually expats are relocating to St. Petersburg with family and they need an apartment of minimum 100 square meters, comprising of at least two-three bedrooms, at least two bathrooms, it is desirable that the master bedroom has a separate bathroom and dressing room, spacious kitchen and a storage room.

Fit-out of the apartment

What should be realized by the owners when they want to rent out their apartment is that their personal taste may differ from the requirements of the tenant.

Renovation and decoration of the apartment has to be of a high-quality. In today's real estate market all the apartments with decent fit-out are in demand, but the following characteristics will help to understand whether the apartment for rent meets tenant’s expectations. Standard requirements are as following:

- Painted walls of light pastel color

- High-quality parquet made of light oak, beech or ash

- Sound proof windows, mosquito screens, blackout curtains needed during white nights

- Air-conditioning system

- High-speed Internet access and Satellite TV. Preferences of the tenants may vary depending on their nationality (Astra for French-speaking tenants or Hot Bird for English-speaking tenants), so installing a satellite dish after negotiating with the tenant is quite appropriate

- At least two bathrooms for the flat (shower cubicle, bath tub, guest toilet). Washing machine and dryer as two separate units

- Kitchen equipment must include stove, oven, dishwasher, air extraction system, spacious fridge.

Main aspects when renting out the apartment

In order to rent a prestigious apartment, the owner should contact a professional real estate company. Professional real estate company will provide a high-quality broker who will visit the apartment, take photographs, give a detailed description to the apartment. When working with a broker, the landlord should give him maximum useful information about the apartment.

Viewing of the apartment

In order to rent out the apartment, it is necessary to show it to potential tenants. Apartment’s viewing must be organized in a good time of the day, considering natural sunlight and other details. The apartment must have a neat appearance, not be overloaded with furniture, personal items and unnecessary interior decoration. When renting out a furnished apartment it is particularly important to prepare the apartment accordingly, including general cleaning, upholstery dry-cleaning. Customers often pay attention to the condition of the kitchen equipment, such as filters in the air-extraction system. The better is the condition of the apartment, the more attractive and desirable it looks to potential tenants.
Second viewing of the apartment shows a real interest to the flat, but that does not mean that before taking a decision, the client visits only this very apartment and doesn’t consider other options.

Negotiation process

The landlord should be more flexible to the wishes of the potential tenant. It should be taken into consideration that quite often the claims of the tenant do not exceed 1-2% from the annual lease cost.

When dealing with a corporate client, the owner should read the text of agreement attentively and pre-discuss any possible changes with the broker before signing the lease agreement.

When handing over the keys to the apartment, the owner should explain to the tenant how to use them. He should also instruct him on how to use all the household appliances. The landlord should not forget to give the tenant all the information about the phone number of the apartment, entrance codes, postal address and postal code. Real estate agent will help the landlord to pay attention to all these details.

Legal aspects of lease

Tenancy agreement/lease agreement

According to Russian legislation lease agreement is concluded when the lessee is a legal entity. In case when the tenant of the apartment is a natural person tenancy agreement is concluded.

The right for renting out the apartment belongs to its owner. The Landlord / The Lessor may also be the person authorized by the owner to rent out his property.

The lease/tenancy agreement legally establishes the rights and obligations of each party. The Agreement takes effect immediately following its signing by both the Parties and the rental period begins from the moment of signing transfer-acceptance act of the apartment.

Taxes

When renting out the apartment, the owner receives taxable income. Tax rate depends on the status of the lessor.

Russian tax residents are Russian and foreign citizens who reside in the territory of Russia more than 183 days a year. For this category of taxpayers tax rate is 13% from the amount of income received.

In case of lease agreement with a legal entity, the lessee becomes a tax agent of the lessor and has the obligation to deduct and transfer taxes on behalf of the lessor.

Tax non-residents - are the citizens who have some source of income in Russia (for example, from renting out the apartment), but reside in the territory of the Russian Federation less than 183 days a year. To this category of taxpayers belong both foreign nationals and Russian citizens who own real estate property in Russia, but normally live abroad. Tax non-residents pay 30% taxes from the amount of income received.

In case when the owner of the apartment is an individual entrepreneur, simplified tax system is applied. It allows the taxpayer to pay the tax at the rate of 6% from the total amount of income received.