What is the "Dolina Effect" and Why Has It Become One of the Key Risks in the Real Estate Market of Russia and the CIS? An Analysis of Threats for Investors, Reasons for Legal Cancellations of Transactions, and Recommendations for Protecting Buyers.
The term "Dolina Effect" entered the mainstream following a high-profile case involving the renowned singer Larisa Dolina. This phrase refers to a fraudulent scheme wherein a flat seller (usually an elderly individual) subsequently cancels the transaction through the court, claiming to have fallen victim to phone fraudsters. Such a scheme allows the "seller" to reclaim the apartment while keeping the buyer's money. The emergence of the term has been documented in the media and even in encyclopaedic sources: for example, at the end of 2025, Wikipedia published an article detailing this phenomenon (predominantly associated with cases involving elderly sellers).
The Origin of the Term
At the heart of the narrative is Larisa Dolina's case. In the summer of 2024, the singer sold her apartment in Moscow and handed over the proceeds to fraudsters (part of the money went through "safe accounts"), only to later discover that she had been deceived. In September 2025, the court deemed the transaction invalid due to "defect of will" on Dolina's part (as she was misled), returning her apartment, while the buyer lost both her home and her money. This sensational precedent served as a wake-up call: similar stories began to emerge nationwide. Sellers and their relatives commenced legal action seeking the return of properties, arguing they were deceived. In legal and media circles, this scheme became termed the "Dolina Effect," where a singular incident transformed into a widespread fear in the secondary real estate market.
The Legal Essence of the Problem
The conflict of legal interests is straightforward here: on one hand, there is the protection of the rights of the "aggrieved" seller (especially vulnerable elderly individuals) to reclaim their property, and on the other, the rights of the bona fide buyer to retain their acquired property. As proving any criminal connection between the buyer and the fraudsters is typically impossible, courts often apply norms that protect sellers from deception or misrepresentation. The main grounds for recognising a deal as invalid include significant misunderstanding on the seller's part or deceit (Articles 178, 179 of the Civil Code of the Russian Federation).
- Courts frequently declare transactions with vulnerable sellers invalid under Articles 177-179 of the Civil Code of the Russian Federation (incompetence, misunderstanding, fraud).
- In practice, after challenging a contract, the buyer is often left without property, and the paid funds are rarely returned — frequently, the money remains "frozen" until the completion of a criminal trial against the fraudsters.
- The courts' position focuses on protecting the "weaker party" in the transaction: if it is proven that the seller acted "unaware" (due to age, illness, stress, or pressure), the contract is annulled, despite its formal legality.
Scale and Consequences for the Market
The problem has extended far beyond a singular case: by 2025, thousands of transactions across Russia had already been contested under such schemes. Even if official transaction figures remain stable, market participants are noting a rise in anxiety. Buyers are shunning deals involving suspiciously low prices or elderly sellers and are demanding additional guarantees. Many secondary transactions now involve supplementary checks and conditions.
- In major cities, there is a sharp increase in secure transactions: for instance, notaries in St. Petersburg report that by autumn 2025, the number of transactions through notary deposits has more than doubled.
- Real estate agents are noting an increase in the complexity of transactions involving "pensioner" flats: documents from psychiatric dispensaries, involvement of relatives, recording of video sessions, and detailed scrutiny of documents are now required.
- There is likely to be a decline in the liquidity of such properties: the market fears "volatile" offers, and pensioners' housing is sold at a discount or takes longer to sell.
Risks for Buyers and Sellers
- Buyer: loss of ownership rights (the apartment is returned to the previous owner), freezing of invested funds and mortgage obligations, prolonged legal costs, and reputational risks.
- Victim "Seller": the risk of losing both the apartment and the money (especially if the funds were handed over to fraudsters), pressure from relatives and law enforcement, the need to provide testimony, and participate in litigation.
Government and Professional Community Response
The government has begun to closely monitor the situation. Legislative proposals and protective measures are being discussed in the State Duma: it is proposed to make notarisation of real estate transactions mandatory, to require insurance for the property under special circumstances, and to introduce a "cooling-off period" (holding funds in a bank deposit for several days). Agencies are coordinating the assessment of legal practice. Professional communities are also proposing new standards: for example, expanding notaries' rights to verify the history of the property and the seller's condition, enhancing bank compliance (banning "safe accounts"), and developing guidelines for real estate agents working with vulnerable owners.
Practical Recommendations for Buyers
To mitigate the "Dolina Effect" in specific transactions, buyers should:
- Thoroughly check the seller and the property: request an up-to-date excerpt from the Unified State Register of Real Estate (USRN) to identify the chain of ownership and any restrictions, examine ownership documents and encumbrances.
- Assess the seller's condition: meet in person, inquire about their family and financial status, and analyse any suspicious signs (sharp discounts, urgency, emotional state).
- Conduct the transaction under expert supervision: engage an experienced lawyer and notary, arrange payments through a bank escrow or notary deposit, ensuring funds are transferred to the seller only upon registration of the transaction.
- Involve guarantees: include the seller's relatives or guarantors in the transaction, who can confirm the seller's voluntary intent and be prepared to refund the buyer's money if the deal is annulled.
- Consider title insurance: such a policy can compensate paid funds in the event the transaction is later declared invalid.
Practical Recommendations for Elderly Owners
To avoid becoming part of such a scenario, elderly property owners should:
- Avoid trusting suspicious calls: ignore messages "from the authorities" and offers to transfer funds to "safe accounts" from strangers.
- Consult before selling: discuss terms with trusted relatives and a lawyer, avoid making urgent deals under pressure, and do not sign documents without understanding their implications.
- Ensure reliable transaction conduct: where possible, utilise notarial certification and inventorying of assets, and avoid granting broad power of attorney unnecessarily.
- Implement protective mechanisms: in consultation with family, issue limited power of attorney, guardianship, or restrictions on registered transactions without personal participation. Also, consider drafting a will or prenuptial agreement to pre-determine the fate of the property.
Possible Future Scenarios
If current practices persist, the volume of legal disputes and distrust will continue to grow: transactions will become more expensive and time-consuming, and the segment involving elderly sellers may slow down. Concurrently, authorities and businesses are seeking a balance of interests. Among the discussed measures are the expansion of mandatory title insurance practices, introduction of a "cooling-off period" (e.g., a week-long hold on funds in the bank), the creation of central risk registers, and mandatory checks of the mental and financial state of the transaction's seller.
Conclusions
The "Dolina Effect" is not a one-off incident of notoriety but a symptom of the systemic vulnerability of the real estate market to fraud and legal uncertainty. Investors must remember: real estate transactions require thorough preparation and professional support, especially when the seller is vulnerable. Only a comprehensive approach – deep verification of the property, notarial supervision, careful organisation of payments, and risk insurance – will help avoid costly losses. Without such measures, the "Dolina Effect" could impact nearly any home buyer.
