Impact of Recent Sanctions on the Housing Market

Fri, Mar 11, 2022 at 10:15AM

Impact of Recent Sanctions on the Housing Market

Many of you may be asking or getting questions about the impact of recent sanctions and federal actions on the housing market, so we wanted to share a few resources with you.  

First, see NAR's guidelines for real estate professionals aimed at increasing awareness, knowledge, and understanding of the potential money laundering risks surrounding real estate, as well as how to report issues through Suspicious Activity Reports (SARs). The Office of Foreign Assets Control (OFAC) of the U.S. Treasury Department maintains a list of jurisdictions subject to sanctions, and a good source of locations posing a heighted anti-money laundering risk. The names of individuals, groups, and entities subject to OFAC sanctions are generally listed on OFAC's List of Specially Designated Nationals and Blocked Persons.

Second, NAR's Senior Economist, Gay Cororaton, wrote a blog post earlier this week that highlights details of Russian buyers compared to all foreign buyers, as well as where and what they are purchasing.

"Russia has little direct impact on the U.S. real estate market as it accounted for less than 1% (0.8%) of all foreign buyers who purchased U.S. residential property during April 2015–March 2021, according to data from NAR's survey of foreign buyer transactions of its members with about 5,000 respondents. Moreover, total foreign buyer purchases account for just 1.8% of total existing-home sales."

When it comes to anonymous purchasers, the Administration is currently in the rulemaking process to increase transparency and crack down on misuse of shell companies for illicit purposes, including laundering money through real estate in accordance with the Corporate Transparency Act (CTA). While those rules are not yet final, the Geographic Targeting Orders (GTOs) are still in place that require title companies to report beneficial ownership information on certain all-cash transactions. Those counties currently include:

  • California: San Diego, Los Angeles, San Francisco, San Mateo, or Santa Clara Counties
  • Florida: Miami-Dade, Broward, or Palm Beach Counties
  • Hawaii: City and County of Honolulu
  • Illinois: Cook County
  • Massachusetts: Suffolk or Middlesex Counties
  • Nevada: Clark County
  • New York: Boroughs-Brooklyn, Queens, Bronx, Staten Island or Manhattan
  • Texas: Bexar, Tarrant, or Dallas Counties
  • Washington: King County

Also, earlier this week, FinCEN issued this alert advising financial institutions to be vigilant against efforts to evade Russian sanctions, highlighting red flags and federal reporting obligations under the Bank Secrecy Act. In addition, FinCEN reminds financial institutions of the dangers posed by Russian-related ransomware campaigns.

Lastly, there continues to be increased focus on regulation in real estate, which NAR commented on last month. For more information, please check out


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