Recommendation points
The consulting company Knight Frank, summing up the results of the past month, noted that transactions totaling $ 87 million were concluded on the Moscow elite real estate market.
These results became a record this year and more than double the figures for May 2011, when the volume of transactions amounted to $ 40.4 million, so experts confidently speak of a significant increase in demand for luxury apartments in the center of the capital..
The average cost of an elite apartment in the Central Administrative District in May was $ 3.1 million, the average cost per square meter was $ 24,980.
Analysts at Contact Real Estate also noted a significant increase in demand for the purchase of elite housing in new buildings located in the center of Moscow. According to the data received, in the first three months of 2012 alone, more than 250 apartments were sold, the total amount of transactions in this segment of the primary market reached $ 430 million. Representatives of the Blackwood company have calculated that in January-March of this year, about 125 apartments were sold in the market of prestigious expensive new buildings.
The activity of buyers in the elite suburban real estate market has also sharply increased – in May, 36 transactions related to the purchase and sale of expensive mansions, cottages and townhouses were concluded, this is also a record result over the past year. Interestingly, about 90% of the transactions were completely with houses and estates in the villages located on the Novorizhskoe highway.
The average price of an elite country house is $ 24 million, the average cost of one square meter of prestigious real estate near Moscow is $ 5,100.
Such statistical results enabled Penny Lane Realty experts to talk about an increase in demand for luxury properties in the first quarter of 2012 by 15%, and in April and May the popularity of expensive prestigious properties increased by 25% compared to the same period in 2011. Blackwood analysts agree with their colleagues – the level of sales of elite housing this spring increased by 23-25%.
What is the reason for such an increased interest in expensive Moscow real estate, and which apartments and mansions are in high demand??
Most popular offers
Before looking into the reasons for the growth in sales in the “elite” real estate market, it is worth analyzing which housing is especially popular. The trend of recent months is such that at the peak of demand were apartments in quiet central areas famous for their history, an abundance of interesting corners and a relatively favorable environmental situation..
So, most of the buyers choosing apartments in the center of the capital preferred quiet, cozy lanes in the vicinity of Patriarch’s Ponds or Arbat, and not at all the Golden Mile, where it is quite difficult to find a green zone.
The exclusive residential complex “Three Poplar” is located on the outskirts of Plyushchikha – between 1st Truzhenikov and 2nd Vrazhsky lanes.
Among the most demanded offers is the residential complex “Three Poplars on Plyushchikha”, which is located on Savvinskaya embankment, in a very quiet part of the city and at the same time in the very center of the capital. The demand for apartments in this residential complex is so great that a so-called “waiting list” of potential buyers has already been drawn up. The cost of apartments ranging from 180 to 474 square meters – from 1.5 to 4.5 million dollars.
In addition, the House on Tishinka, Granatny 6 and 8, Stolnik, Park House, Noble Nest, House on Bolshoy Afanasyevsky, Andreevsky House on Frunzenskaya, House on Sytinsky Lane, Barkli Virgin House are in high demand. The average cost of apartments sold during May in these residential complexes, which are mostly Club Houses, was $ 8.3 million.
Apartments in Knightsbridge Private park in Khamovniki are still popular, the average price is $ 20 thousand per square meter and in Sadovye Kvartalakh – about $ 15 thousand per square meter..
According to analysts, this trend is primarily due to the fact that many buyers choose housing for permanent residence, paying great attention to the area, developed, convenient infrastructure and the presence of respectable neighbors. As a result, Tverskaya and Khamovniki in the spring of 2012 accounted for more than 80% of all transactions with luxury real estate.
Fashionable residential area in the Khamovniki area Knightsbridge Private park
Another interesting trend in recent months is the growing demand for apartments with larger living space. “Odnushki” in the elite real estate market, in principle, are a huge rarity, there should be at least two rooms, but current buyers choose housing with an area of at least 120 “squares” According to Ekaterina Batynkova, Deputy General Director for Real Estate at UNIKOR Management Company, if the average area of an elite apartment in January was 130 square meters, then by April this figure had grown to 177 square meters, which clearly indicates an increase in interest in spacious apartments, calculated for a large family.
If we talk about elite suburban real estate, then real estates with a large land plot in closed cottage settlements with their own infrastructure are the most popular here. The clear leader is the Novorizhskoe direction. According to Vera Potekhina, head of the suburban housing department of the analytical center of the INKOM corporation, as of early May, the average cost of cottages in the Moscow region was 15.1 million rubles, duplexes, that is, houses for two or three families – 10.9 million rubles. townhouses – 9.9 million rubles, a three-room apartment in low-rise residential buildings – 4.1 million rubles.
Prerequisites
Back in the fall of last year, when demand for elite real estate in Moscow was stable, and there was no need to talk about a sharp increase in sales, Alexander Ziminsky, director of the city real estate department at Penny Lane Realty, noted that in the coming year, interest in expensive prestigious projects will increase significantly.
According to Ziminsky, in 2011 most of the market players, in particular investors investing in real estate with the aim of its further resale and profit, preferred to wait and wait for a more stable political situation in the country..
In addition, the interest of buyers was restrained by rumors about a possible new round of the crisis, the expert said..
Thus, the current surge of interest in buying expensive apartments in Moscow could have been triggered by some lull that characterized the market last year. However, the growth in demand was recorded at the end of December 2011, but at that time most of the experts associated this with the New Year’s campaigns held by developers – pleasant discounts, installments and gifts.
Decrease in supply
According to experts, the main reason for the increase in the growth in demand for luxury apartments and country houses is the reduction in the number of proposals. Prestigious new buildings in the center of the capital can literally be counted on one hand – over the past year their number has decreased by 30%, and in comparison with 2000, it has more than halved.
Land in the center of Moscow is sorely lacking, so the number of new residential complexes is decreasing. In addition, the plans of the Moscow mayor’s office, which decided to revise the already issued investment contracts for the construction of objects in the historical center, also provided a reduction in the number of proposals..
View from the window of an apartment in a personalized club house Barkli Virgin House
According to experts, the demand for elite apartments now remains at the level of 2006-2007, while the number of such apartments on free sale has decreased quite significantly. As Alexander Ziminsky notes, the cancellation of investment contracts and a ban on the development of the historical center will ultimately lead to an even more significant surge in demand for the Moscow “elite”, and in the future – to a significant increase in the cost of such objects.
Regarding the increase in demand for country houses, many experts note that, since the number of apartments in the quiet center is decreasing, the interest of buyers is simply shifting towards the prestigious offers of the Moscow region market.
Other factors
Other reasons for the increase in demand for elite Moscow real estate, the specialists of the Greenwich Group consulting company attribute fluctuations in the dollar exchange rate and the weakening of its position in the market, which led to a slight – by 0.7% – decrease in the cost of housing, since in most of the elite projects prices are fixed in rubles.
In addition, analysts believe that the elite real estate market, as the one most affected by the financial crisis, is still recovering from the lost positions, and since the “bottom”, that is, the lowest level of demand for “elite”, has already been passed, the tendency to increase the popularity of such proposals is a completely logical development of events.
And Elena Arosyeva-Kashirina, head of the BEST-Elite elite real estate department, said that the reason for the sharp increase in interest in expensive apartments and mansions was weather factors, spring mood and a general increase in market activity.
Perspectives
Whatever is the reason for such a tangible increase in demand for luxury apartments in the center of the capital and mansions near Moscow, analysts are sure that it is too early to talk about an established trend..
Summer is a traditional vacation period and, accordingly, a lull in the business sector, most likely, the real estate market will not be an exception, and the number of transactions will decrease. Only after analyzing the sales results in September-October it will be possible to say with confidence that the growth in demand is caused by more significant reasons than the “spring aggravation” of interest.
Residential complex “House on Tishinke”
But experts are unanimous about the growth in value – the laws of the market are unchanged for all spheres of the economy, and an increase in demand along with a decrease in the number of offers cannot but cause an increase in prices for elite properties. Analysts find it difficult to say exactly how much the price of real estate “elite” class in Moscow will increase – perhaps by 5-6%, and maybe by 10% in dollar terms..
I would very much like to say that the increase in demand for elite, luxurious, incredibly expensive apartments and mansions in Moscow and the Moscow region is associated with an increase in the well-being of Russians and an increase in wages, that is, a larger number of Muscovites can now afford elite square meters. However, only a few can still pay $ 3, 8 and 24 million for new housing, so, unfortunately, such a reason will sound at least ridiculous..
Why is the demand for elite real estate in Moscow increasing while the number of offers is decreasing?