Affordable Real Estate

The ruble fall, increasing inflation level, slow economic growth and unfavourable experts’ forecasts force many citizens to invest their savings in more stable assets or take loans in current prices. Real estate has always been the main direction for investment. In Soviet times people were used to unified standards — the same clothes, work, daily routine, flats and furniture. Nowadays Russian residential property market offers increasingly more variants, including those for small budgets.

The basis of affordable real estate market is made by small flats in blocks of flats on the primary market; however, there are more exotic offers. For example, in this decade there has been a large-scale overhaul of wood house-building. Although pre-revolutionary and wartime dilapidated buildings still make the basis of the wood house image all over Russia, “German Fachwerk”, “ecological houses”, and “Finnish technologies” start to take root in buyers’ conscience.

It should be noted that wooden housing is widespread in the USA, Canada, Germany, Finland, Sweden, Denmark, etc. The share of wooden houses in North European countries reaches 50% in the city housing stock and about 85% — in rural one. The largest world producer of wooden houses — Finnish company Honka — successfully sells its products in 30 countries of the world.

The most widely spread technologies in wood house-building are frame and panel construction, and also construction of solid timber.

So called “ready-to-live-in houses”, when houses are built at the factory and assembled at the buyer’s site during several days or even hours, are still new for the Russian market. For example, some firms offer their clients to purchase a small-size house (35–50 m) with furniture, plumbing and other — such houses are simply placed on the client’s foundation. Their cost varies within 1–2 million rubles together with furniture — depending on the assembly. The most important thing here is having a land plot.

Another variant is houses built in accordance with Canadian technology: they are also delivered to buyers and assembled using prepared frames. The difference is that not the entire house is transported, like in the previous variant, but its walls, roof, etc., and then the components are pulled apart — also during several hours. Such a variant makes it possible to have a large house. Delivery and assembly of furniture and connection to utilities take 1–2 days.

Such pull-out houses are delivered to Russia from abroad, due to which their cost is an order of magnitude higher — 2.5–3.5 million rubles. The basic value offer of such houses is their mobility, while the latter has the possibility of repeated assembly and disassembly. However, it is a big question whether this characteristics is of interest for buyers.

A small flat in a new house in the residential district or in an old Khruschev-era apartment close to the city centre, a private house, which constantly requires financial investment — there is such market supply.

However, the closer it is to Moscow, the less affordable housing is. And even with the average Muscovite’s wages only 28–30 sq. m of medium quality can be bought mortgaged for 20 years.