IntermarkSavills presents analysis of the "Moscow Elite Residential Markets, First half of 2010."

12 july 2010

IntermarkSavills presents the overview "Moscow Elite Residential Markets, First half of 2010".Which encompass the elite, business-class, out-of-town sales markets and rental market.

Few words about these markets in the first half of 2010:

«During the past two quarters the average prices in new-build business-class residential complexes have grown by 5% in US dollars and by 9% – in Russian rubles. However, it would be premature to say that there is a renewed growth trend in prices. The registered growth was primarily caused by so-called technical factors: the rising level of building preparation, disappearance of low-cost projects from the market, and the growth of the US dollar against the ruble»

Dmitry KHALIN, Head of Strategic Consulting and Valuation Department, IntermarkSavills

The premium-class residential market has registered a further growth in prices. During Q1 and Q2 2010 the growth was 16%. In April 2010 four key projects added 7.5% to this growth, and more than half of the current supply is in these four projects. The current price of elite housing lags behind its pre-crisis maximum (July 2008) – by more than 35% in dollars and by approximately 15% in rubles.

Ekaterina GURIEVA, Head of In-town Residential Real Estate Department, IntermarkSavills

During the first two quarters of 2010 completed villas were in high demand, the same as at the end of 2009 (sales in the most successful projects reached 4 units a month), and plots without a construction contract were also in demand. From January to June prices for the high-budget suburban housing market grew slowly: from 0.5% to 1.5% a month. However, the average supply price remained at a level lower than 30% as compared to the pre-crisis level…

Olga VINOKUROVA, Senior Analyst of Marketing and Market Monitoring Department, IntermarkSavills

In spite of the increase in marketed rental prices and the growth of average rental budgets set by prospective tenants that we have been observing over the previous 12 months, it is still too early to announce a recovery of the elite rental market. An analysis of the concluded lettings for the 1st half of 2010 indicates that the greater number of lettings transactions continue to be concentrated in the lower price segment (from $2,000 to $4,000 per apartment per month), which suggests that solvent demand continues to remain low.

Marina MOROZOVA, Head of Property Department, IntermarkSavills