Moscow Property Prices on the Rise
An unprecedented growth in construction and demand has turned the Moscow retail market into one of the most expensive in the world. The bubble doesn't look like bursting anytime soon either with favourable oil prices flooding the Russian marketplace and investors swamping the city, eager to get a piece of the increasingly valuable property pie.
Residential property prices have almost doubled in the past year and the value of office buildings has risen so sharply that they are now more expensive than in New York. The average price for a square meter in Moscow is now over $4,000 (USD), and in the city center, it sometimes exceeds $20,000.
Along with elevating the city's skyline, the property boom has changed the aesthetics of the city, giving it a more colourful and vibrant look and feel. New apartment buildings tower over existing buildings and the new "modern" Moscow is today resembling little of the grey and dull architecture, which characterised the city during Soviet times.
On a sour note, the rising prices mean that fewer and fewer people are able to afford new housing, particularly young families. The property boom has brought with it unrealistically high prices, which are well out of reach of citizens and families who cannot fall back on the luxury of a high income. Instead, the flats and apartments are being snapped up by wealthy Russians and some foreigners, predominantly as an investment opportunity.
Real estate experts have also noted that if the rapid pace of the property boom continues, supply will fall well short of demand and the housing shortage which has existed in Moscow since Soviet times will only worsen.