Sixty-six percent of new-construction apartments in Russia were languishing without buyers this December, based on the total square meterage of housing under construction or first listed for sale.
This figure was reported by the RBC, based on the estimates of INFOLine-Analitika, a market-research company that conducted a study of the Russian real estate market using public data on new construction.
The publication points out that this represents a maximal share of unsold real estate since January 2020, when the share of unsold square meterage was 60 percent of all new-construction housing on the market.
INFOLine-Analitika CEO Mikhail Burmistrov thinks that the proportion of unsold new housing is the highest in Russian history since the Soviets.
The state-run company Dom.RF claims that the share of unsold square meterage in Russia’s new housing is more than 41 million square meters, which is 44 percent above its share in early 2021. Another 25 million square meters of new housing is yet to hit the market.
Burmistrov thinks that housing demand is affected by Russia’s population dynamics:
We’re entering 2023 not only with a stable growth of mortality in excess of the birth rate, but also with a large wave of emigration. Emigration has a negative impact on housing demand, since it’s the wealthier people who leave. Fifty percent of all Russian dollar millionaires left Russia between March and November 2022.
Another factor that hampers demand, Burmistrov adds, is that Russians have clamped down on spending and stopped investing in comfort.
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