Despite a drastic fall in the Russian property market last year, there are signs to suggest that activity is starting to pick up in 2010.
Before the housing crash in the country, competition was so stiff in Russia that many prospective buyers in Moscow were grateful simply to be given an opportunity to take part in a bid for a property. In comparison, buyers are reportedly being given a kilo of gold to encourage them to move into empty properties.
The Russian property market is showing tentative signs of recovery though, which is driven by buyers? returning confidence to the economy, and it?s having an impact on house prices. However, as demand returns to the market, there follows a shortage in housing supply as many builders found it difficult to survive the difficult 2009, and this is likely to have an effect over the next few years.
In February 2010, 23 per cent of house purchases were done so with a mortgage, whereas only around 5 per cent of house purchases were funded with a mortgage in 2009.
Despite the positive figures, Tigran Hovhannisyan of investment bank URALSIB did not believe that this is enough for Russia to see substantial growth in the housing market in 2010. He has said though that he believes that the drop in property prices as a result of the financial crisis will encourage more potential buyers in the big cities.
Mr Hovhannisyan said: ?Now, the cost of buying an apartment is within the capability of the average income. Before, it was at least double the average income.?
