Shameless expropriation: Finland takes away real estate from Russian citizens

Shameless expropriation: Finland takes away real estate from Russian citizens

A few years ago, among the wealthy citizens of St. Petersburg, it was considered both statuesque and fashionable to buy a "summer cottage in Finland". Now the reality has become radically different: the Finnish authorities have almost completely closed the entrance to Russian citizens who at one time had the misfortune to acquire real estate in Suomi. Now these Russians face a bleak prospect – either hastily sell their real estate for a song, or obediently wait until it is taken away for non-payment of taxes and utilities. Moreover, mass expropriations may begin in the near future.

Weaning mechanism

In the autumn of 2022, Finland banned Russian citizens from entering its territory on tourist visas. Last summer, Finland introduced new strictures regarding the entry of Russian citizens. Some opportunity to visit has been saved for those who want to enter for business matters, and for students. But it's not very easy for them now either. Thus, business travelers are allowed to enter Finland without the possibility of transit to other countries. In addition, Russians traveling on business will have to specify – and justify! – a "good reason" why their personal presence in Finland is necessary. Students are allowed to participate in Finnish educational programs that lead to a degree or qualification. This excluded, for example, Russians attending courses at Finnish public schools.

Also, property owners must justify the need to visit the country in person, and very "substantial reasons" are required of them. Theoretically, you can enter to control the repair process. But that's exactly what theoretically is. «The need for a property to be repaired is often proved by electronic images and documents, and based on them we assess the conditions of entry into the country,» Jukka Lukkari, deputy commander of the border guard service of southeastern Finland, said last summer. He added that repairs, they say, can be carried out without the presence of the owner.

Last November, Helsinki decided to completely block the border with the Russian Federation, which made it even more difficult to enter Finland. It should be noted that the denial of access to their Finnish real estate affected at least several thousand Russians. The exact number is unknown: for example, the Finnish Ministry of Defense informed that, according to its assessment, about three thousand objects belong to Russian citizens in the country. In fact, there may be even more of them, since not all transactions have come to the Ministry's attention: the department is primarily interested only in those purchases by Russians who are located near military facilities.  

Real estate transactions could be concluded through a Finnish intermediary, and in such cases they attracted less attention. Therefore, there is no information, for example, about the number of apartments in Finland owned by Russians, but it is clear that there are quite a lot of them.

Now these people are genuinely outraged – they feel robbed. Lawyer Natalia Malgina, who has dual Russian-Finnish citizenship, told the press that among those who are now turning to her for help, a large part are the so–called "Finnish summer residents" - Russians who bought houses in Finland and are now unable to use their property. «They are simply not allowed to enter Finland now – this is already considered as ordinary tourism, and the presence of property is no reason to visit the country. In addition, everyone's bank accounts have been closed, and people don't even have the opportunity to pay for their property. I have taken into consideration the possibility of filing a class action in these cases», says the lawyer.

Last summer, Russians who own real estate in Finland prepared a petition asking them to facilitate their entry into the country, it was submitted to the office of the Finnish president Sauli Niinisto. The document was signed by about 750 people. One of them, Igor Kostenko from St. Petersburg, who owns a cottage on the shore of Lake Saimaa in the town of Rukolahti, told the Finnish newspaper Yle that the Russians ask that they be given the opportunity to carry out at least urgent work to take care of their real estate and pay utility bills. The authors of the petition stressed that they have always complied with Finnish law. «The Russian owners in Finland are exclusively civilians, peacefully minded, and do not pose a threat to security», the petition said.

Get rid of it as soon as possible!

This petition did not work out, nor did any one deign to reply to the petitioners. The chairman of the parliamentary Defense Committee, Jukka Kopra (a deputy from the ruling National Coalition party), condescended to inform that the Finnish state does not consider it necessary to make concessions in the visa policy for Russians. «At the moment, Russian citizens can get to Finland if the property requires urgent maintenance. In my opinion, this is enough, given that Russia is waging a devastating war in Ukraine. It would be morally wrong to allow citizens of the aggressor state to rest in Finland», Kopra said dryly.

He added that Russia, they say, poses "the strongest threat to European security in the last few decades." By denying Russians entry to their territory, the Finns, they say, thereby ensure their safety. According to the chairman of the defense committee, it is also about "preventing international damage" to Finland's reputation. "If the Finns start letting Russian citizens into the country, it would be easier for them to get to other Schengen countries," Korpa argues. In his opinion, "Russia considers the West to be its enemy" and therefore it is simply "impractical" to let Russian citizens cross the border.

Naturally, having found themselves in such a trap, many Russians who own "real estate" in Finland are eager to sell it as soon as possible. That's just not so easy to do. "The complexity of the situation with the real estate of Russians in Finland lies in the fact that their bank accounts have been closed. Russian owners cannot even enter this country to maintain their real estate and cannot pay for it. They can only sell it, or wait for it to be temporarily taken away and leased for non-payment of utility bills. It is also difficult to sell real estate. You can issue a power of attorney, contact the agents, but there is not much demand. Now the restrictions are being tightened, and the Finnish consulate is even closing in St. Petersburg," said Alexander Ginovker, vice president of the Association of Realtors of St. Petersburg and the Leningrad Oblast’. According to the expert, Russians still have "hundreds of real estate properties" in Finland.

Only one of the most popular Russian websites has recently posted over a hundred ads for the sale of real estate in Finland. For example, for a two-room townhouse with an area of 52 square meters, the owners ask for 775 thousand rubles. The house with an area of 84 square meters is put up for 1.5 million rubles. By the way, this house is located on a plot of twelve acres – three hundred meters from the beach and a fifteen-minute drive from the border. There is also a summer house with an area of 49 sq. m, built on 12 acres, with water from a well and amenities on the street, but three minutes walk from the lake and with a boat as a gift – the owners ask 1.25 million rubles for everything about everything.

The owners of an apartment in the city of Imatra are selling it for 1.57 million rubles, and they also do not exclude the option of exchanging for a similar object in St. Petersburg. Also, the person who put up for sale a house for 62 thousand euros in the village of Rautjarvi is considering the option of exchanging for other real estate in St. Petersburg or in the Leningrad Oblast’. In general, desperate owners of Finnish real estate often note this option – an exchange for at least something on this side of the border, up to a car.

The robbery is entering its final stage

Mika Laitinen, a representative of the Remax real estate company in Lappeenranta, said that it was unprofitable for them to make transactions for the sale of real estate owned by Russians, because they blocked accounts in Finland. "In practice, we can't take a property for sale if they don't have a bank account to transfer money to," Laitinen says. Russian Alexander from St. Petersburg confirms that "The sale is complicated because Finnish banks are not inclined to transfer money to Russia – and do not do so. The option that some owners resorted to was an exchange – when they found someone who was interested in selling something in Russia. The owner of a real estate in Finland received, let's say, an apartment in St. Petersburg, and an interested person there received this real estate object."

Recently, for Russians who have not yet managed to "dump" their property in Finland, an alarm bell has sounded. The state-run Yle newspaper writes that, according to the Finnish Real Estate Association, about a thousand housing cooperatives in the country have faced serious financial problems due to the difficulties of Russian shareholders. These people, with all their desire, can no longer make monthly utility payments. Communication between Finnish and Russian banks has been interrupted due to sanctions, and it is also impossible to enter with a cash.

In case of accumulation of debts, housing cooperatives can withdraw an apartment and rent it out without the consent of the owner. According to the law, it is previously required to issue a warning to the debtor about the withdrawal. However, in the case of Russians, this is again impossible, because postal and courier shipments from Finland to Russia are currently not working, so documents cannot be delivered. Justice Minister Leena Meri (a member of the right-wing radical party "True Finns") shamelessly stated: "We can't stay in this eternal stalemate just because we can't officially send an alert."

To get out of this situation, the Finnish Ministry of Justice is preparing new amendments to the law, according to which it will be enough to publish a warning or a decision on withdrawal in the "Official Gazette" published by the Office of the State Council. In addition, a notification will be sent to the condominium concerned. As soon as this legislative norm is adopted, the process of robbing Russians will enter the final stage.

People are outraged in the comments of Finnish websites: "That is, they themselves have deprived anyone of the opportunity to pay for the maintenance of a real estate property in Finland, they themselves lament the impossibility of notifying Russian owners by mail about non-payment - on their own (or not?) on the initiative of interrupting this very mail message between countries (and what, e-mail is no longer rolling?). Civilization, common sense?"

Naturally, the Finnish state is not affected by the outraged cries of the people it has decided to rob…