Wednesday, June 1, 2011

"Oil Painting": for rent as an indicator of the economy

Russia in terms of migration mobility is far from the U.S. - people here are mostly tied to the family hearth. But all the same information on apartment rental show growth or decline of the economy in the regions of the country, experts think tank "Real Estate Market Indicators." In Moscow Realtor agencies show an increase in prices of hiring apartments, although in different scales. But the increase of rents in the capital, clearly proves the economic growth coupled with increasing incomes of the economically active population. So far, however, the middle and upper middle level management. As experts of company "MIEL-Rent," revealing moment for February 2011 was the gap between demand and supply in the most sought after price range of city apartments (from $ 1 thousand to $ 3 thousand per month) - in February it was 2,8 times. In general, the demand for rental apartments in Moscow in February 2011 compared with January, changed slightly and amounted to only 1,6%. Landlords feel the same as if the inflow of tenants in the market, and the proposal had passed the minimum threshold of January, began to increase. Supply growth compared to January was 16.1%. Maximum demand in February to use the flat price range from $ 1 thousand to $ 3 thousand per month (46,6%). They also occupied a leading position in the structure of the sentence (50%). The second highest number of proposed flats has become the cheapest segment - up to $ 750 per month (26,2%). Demand much more enjoyed the apartments from $ 750 to $ 1 thousand per month (second place in the structure of demand, which amounts to 33,5%). According to the results of February the potential demand for rental apartments over the same period of January increased by almost 30%. Such data are reported in the department of secondary housing rental department of the ABC of Housing. " "Since February the market rental housing in the metropolitan region is developing at quite the expected scenario: a moderate behavior of potential tenants and homeowners are not accompanied by a noticeable change in the average rental rates", - said Andrei Bannikov, head of the secondary housing company "ABC Housing. According to the agency "Relight-estate", for 2010 rents on the capital market increased significantly in the segment of economy class: one-bedroom apartments have increased in price by 19%, doubles to 15%. According to Galina Fabritskoy, head of leasing companies, traditionally the highest growth rate observed in September and October. In winter 2010 rental rates for the most popular one-bedroom apartments averaged $ 21 thousand rubles. per month. In August-September, rates rose to 23 thousand, and in October to 25 thousand rubles. per month. In the crisis in 2009 over 25 thousand rubles. you could find one bedroom apartment. "It should be noted that the demand exceeds supply in virtually all price ranges - emphasizes Maria Zhukova, deputy director of MIEL-Rent" - except perhaps that the most expensive apartments from $ 6 thousand per month and above. But especially significant is the gap more than doubled between supply and demand in the navigating segment - from $ 1 thousand to $ 3 thousand per month. This at least suggests that labor migrants middle managers - employees, office workers and so on - all those who can afford to rent an apartment at this price, they returned to Moscow. " High budget rent one of the major trends of last year was the return on the rental market corporate clients. According to experts of Penny Lane Realty, the number of companies for employees of tenants had risen to 75% of total customers, up 15% over the same period last year. Change and the national composition of the tenants. First time in two crises, the number of Russians has exceeded the number of foreigners, which in comparison with 2008 has decreased by 25%. However, despite the overall decline in their numbers, budgets for rental apartments among the citizens of Great Britain and the U.S. have increased, and among the French, Japanese and Swiss, on the contrary, decreased. As a result, foreign tenants focus on offering price of $ 3.8 thousand per month. Pent-up demand accumulated during the last months of last year, will be implemented in the first quarter of 2011, this factor will have an impact on the structure of the rental market as a whole: the most liquid and adequately priced apartment business and premium class immediately leave, which may cause a slight rise in price rent in these segments - from 2% to 5%. By the autumn of 2011 experts predict the seasonal rise in demand. Moreover, it can exceed the existing supply in the market that prices will spur a further 5-10%. "A number of objective reasons point to the potential growth in rents of apartments in the capital already in 2011 - said Giorgi Dzagurov. - First, the volume of supply is limited and is expected to grow due to the decline in construction is not necessary. Secondly, without the constant rise in prices for the purchase of real estate mortgage (11% and above) are significantly inferior lease (2-5% per annum). Third, the gap in yield from rental apartments (2-5%) and commercial areas (8-12%) in developed countries tend to decrease, ie, in the future profitability of renting commercial and residential properties will be comparable. Fourthly, a civilization rises. Citizens become more mobile, and this characteristic tenancy differs from the acquisition, where you practically anchored. If we believe that the active population will be more likely to move, the rent is not only convenient but also more profitable, because the annual rent at times comparable with the commission on the sale. And the complex transport situation in the city once again working to raise rental rates. Rent an apartment closer to work - thus saving time and effort to travel to work. " Investment Analysis apartment specialists EVANS based on its own database of objects evaluated Moscow apartments, calculating what yield can bring rent some apartments, depending on the investment in its funds. It was found that the highest profits - by investing in apartments located in the pre-revolutionary buildings or quality of Stalin's homes in prestigious central and western districts of Moscow. "Profitability of rental apartments in Moscow is quite high compared to other developed markets and in certain segments may reach 6% to 10% per annum, - says managing partner EVANS Anna Levitov. - The content of the real estate is not very expensive for most owners. Since a significant portion of wealthy tenants still are foreigners, the best yield given apartments in the city center or close to foreign schools. According to the results of our analysis, apartments in new buildings were not included in the list of objects with a good yield because of the high purchase price. " What's next, "Next year we expect to reduce the amount of the proposal - said Giorgi Dzagurov. - Prerequisites for this is right now: the most attractive and at the same time adequately priced apartments is rapidly withdraw from the market. A new facilities are unlikely to appear before the second quarter of next year. " In business class, supply exceeds demand, experts do not agree "Relight-Real Estate". Segment of the luxury flats are still not fully recovered from the crisis affects a significant reduction in requests from companies that rent apartments for senior officials. Rents for apartments Business-class is not too different from the size of the mortgage payment, and such proposals rather interested in a temporary job, but high-paying tenants who do not want to buy expensive real estate in the capital. For reference, in Russia in February 2011 was constructed 2.7 million square meters of housing, which is 6,4% less than in February last year, reported the Federal State Statistics Service. During January-February 2011 was constructed 5.3 million square meters of housing, which is 11,5% less than the same period of 2010 in January-February, were built in Russia 57.6 thousand new apartments. The 2010 housing construction fell by 3% compared to 2009, was introduced 58.1 million square meters of new housing. Intuitively, for the lease of the biggest "unity" in Moscow, asking 70 thousand rubles. According to managing rental apartments of "Incom-Real Estate. This corresponds to an average monthly income of nine cleaners or a qualified beautician, working in a prestigious salon, according to the site job.ru. Diverse market for rental rooms, it turns out, is only 5 thousand rubles. cheaper than hiring an affordable apartment. According to the company INCOM-Realty, the cost of the cheapest apartment in Moscow, offered for rent in February amounted to 18 thousand rubles. It is only 5 thousand rubles. more than the average market price of hiring a room in the capital. According to INCOM-Estate ", the cheapest offer on the Moscow market rent in February 2011 turned out to be small-sized apartments of 17 sqm with kitchen 2 sq ft, located in a brick house on the street. Ivy (HLW). The cost of hiring an apartment valued at 18 thousand rubles. per month. This is only 4,9 thousand rubles. compared with an average cost of hiring a room in Moscow, which up to February was 13.1 thousand rubles. per month. In general, the average cost of hiring an economy class one-room apartment in the capital up to February 2011 amounted to 26.8 thousand rubles. per month. Price for the apartment for this price level remained at 37.1 thousand rubles. per month. And finally, the price of rent three-room apartment in Moscow at the end of the reporting period was 52.1 thousand rubles. Traditionally, the lowest rents were recorded in the HLW and SEAD, where the average cost of hiring one-room apartment was estimated at 25.4 thousand and 25.6 thousand rubles. respectively. Rental two-bedroom apartments there were 33.4 thousand and 35.1 thousand rubles. And bedroom - 47,4 thousand and 48.7 thousand rubles. per month. The highest rents for up to February recorded in the Central District (this is traditionally estimated by www.irn.ru), where the cost of hiring one-bedroom apartment averaged 29.9 thousand rubles. per month, two-room - 43,1 thousand rubles. per month, three-room - 61.2 thousand rubles. per month. Total supply in the market rent of apartments in Moscow amounted to 37,6 thousand objects.

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