Changes in the market of cottage townships suburbs

05.01.2011 08:00
Articles about real estate | Changes in the market of cottage townships suburbs Over the past five years, the structure offers cottage accommodation near Moscow has undergone significant changes. Until 2007, the suburban market is a luxury housing and housing business class, and all built settlements were aimed at wealthy buyers. And starting in 2007 at suburban market near Moscow appear the first settlements of the economy class, whose number increases every year. About this analytical center "Indicators of Real Estate Market wrote extensively in the article" Structure of a country market near Moscow: Yesterday, Today and Tomorrow. "In particular, over the past 5 years, the structure offers cottage accommodation near Moscow has undergone significant changes. Until 2007, the suburban market is a luxury housing and housing business class, and all built settlements were aimed at wealthy buyers.

It is noteworthy that before 2007 the cost of meter on the country market suburbs and condominium market in Moscow was almost the same. In early 2005, prices per square meter on a suburban condominium market and were at the level of 52 000-53 000 rub., And in early 2006 - 67 000-70 000 rub. But because of the excess area houses compared to apartments total value of households in the country market (the house with the land) several times higher than the price of metropolitan apartments.

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Since 2007, the town market near Moscow began active development of economic housing segment. It resulted from the influence of several factors. First, the decrease in the proportion of available land suitable for building near Moscow and in traditionally prestigious areas, and along with this increase in land prices. Secondly, economic growth in the country and increase incomes. Third, the formation of the so-called middle class and changing the attitudes of many people to the level of living comfort, all of which increased the effective demand for suburban housing.

All this has led to an increase in organized cottage villages in the suburbs and the expansion of geography of the construction. As a result, the III quarter 2008 market share of less prestigious areas rose from 16% to 25%, while the proportion of settlements, located 60 km from Moscow, from 5% to 19% (see "Structure of a country market near Moscow: Yesterday, Today, Tomorrow "). This in turn influenced the change in consumer object properties: increased number of households in the townships, decreased the area of homes and land.

During the same period the price per square meter of housing in the town market suburbs grew by 21%, and the price of a house with land increased by 17%. More reasonable price dynamics of households, compared with the cost of a meter associated with a decrease in average size houses on the market (by increasing the share of cost of housing). Rising prices on the housing market in Moscow for the same period was 32%. As a result, if in 2005-2006. average cost of a meter on the market capital of apartments and town market of Moscow region was comparable, then to the III quarter 2008 the difference in price per square meter was 1.4 times in favor of apartment housing.

It is also interesting to note that since 2007 the average cost per square meter of housing in a cottage village, located on the less prestigious areas, showed a minor correction down to 49 000 rubles. up to 47,500 rubles. for the III quarter of 2008 (see Chart 3). While prices in the settlements in traditionally prestigious areas have shown a steady growth from 91 000 rub. per square meter at the beginning of 2007 to 118,000 rubles. per square meter per III. 2008 As a result, the difference in cost meter cottage housing in traditionally prestigious and less prestigious areas for the period under review increased from 2 to 2.5 times.

The economic crisis of autumn 2008 has led to a change in price trend in the property market and has suspended the development of investment and construction sector in Russia. This period was marked, on the one hand, the sharp decline in housing demand due to declining incomes, rising unemployment, tighter mortgage lending, on the other hand, the almost complete cessation of lending to the construction industry by banks and financial difficulties of most real estate companies. All this has led to what many developers either renounced their construction projects, or to suspend their implementation.

Despite the adverse conditions in the first year after the crisis (III square. 2008 - III quarter. 2009.) Correction of asking prices on a suburban market of Moscow region was much lower than those for apartments in Moscow. According to "Market Research of cottage villages near Moscow for the period 2008-2010, the average cost of a meter of cottage housing in this period declined by approximately 4% (from 104 700 rub. 100 400 rub.). While the index value of apartments in Moscow, to regularly, declined by almost 16% in the year after the crisis. To be fair, that it is in this case on the formal terms of average prices in the suburbs, where the practice implicit lower prices (discounts for a particular client on the town market in this period reached 50% or more).

The reasons for the correction of low asking prices in cottage settlements were as follows. Firstly, the term of the exposure of country houses are much longer than apartments. Secondly, the demand for cottage housing more dependent on the seasonality factor, rather than demand for apartments. Largely because of this suburban market is more inert than the apartment: he later responds to changes in economic conditions and other factors affecting the housing market.

In addition, as noted in the article "Structure of a country market near Moscow: Yesterday, Today and Tomorrow", the first year after the crisis country market proved far more difficult position than an apartment. Narrowed at times effective demand in the segment focused economical apartment housing, and demand for holiday homes has decreased to almost zero. In these circumstances, developers of cottage settlements made no sense to declare loudly about the price drop, because the number of potential buyers has decreased dramatically, and the transactions were a single character. Many developers were willing to provide significant discounts for a specific buyer.

It must be noted that the relative stability of the asking prices on cottage accommodation in the suburbs in the first year after the crisis was associated with a change in concepts of settlements in favor of land without a contract. In many respects it was a necessary measure for real estate developers in the absence of access to financial resources and the decline in effective demand. This in turn allowed them to create more effective products and to maintain a certain level of sales. According to the analytical center "Indicators of the real estate market, the number of such villages has increased over the year in 2,3 times. Offer the market a more economical product, the developers were in no hurry to claim a reduction in prices for houses.

Reduced asking prices in the suburban market began a little later - the fall of 2009 as a result the spring of 2010 the average cost of a meter in a cottage village has fallen by almost 18% and the average price of homes - 27% (due to the reduction of the average area cottages ). In late 2009, there has been revival of demand, and in these circumstances, many developers have announced price cuts to attract more buyers. As a result, significantly increased the market share of cost of country towns, where the average price of the cottage is comparable to the cost of flats in Moscow (not to exceed 15 million rubles.). Following two years after the crisis, the number of cottage settlements grew by almost 30% and now accounts for half of all proposals on a suburban market suburbs. In contrast to the suburban market prices for apartments in Moscow showed an increase of 8%: from 122 800 rub. per square meter in the III quarter of 2009 to 132,800 rubles. per square meter in the II quarter of 2010

In the spring-summer season of 2010 marked a positive price adjustment on the country market in the segment's most attractive towns in terms of location, natural factors, the concept of reasonableness, the degree of readiness. However, the overall average cost of a cottage housing adjusted downward: 3% of the calculation of the price per square meter and 5% of the cost calculation for the house. As of IY quarter 2010 average price of a meter in a cottage village is about 79,600 rubles. And the cost of homes - about 23.3 million rubles. with the average housing area 292 sq.m. This is evidenced by the results of regular monitoring.

Similar price dynamics characteristic of a land market without a contract - segment of the suburban real estate, which received an impetus to development in crisis conditions. According, in mid-IY quarter 2010 average price of one hundred square meters of land without a contract in the organized settlements remained at the level indicators II quarter - about 241,000 rubles. And the average cost of land is about 4 million rubles. 16.8 per hectare.

According to the analytical center "Indicators of Real Estate Market in the winter 2010-2011. appreciable price dynamics in the country market is not going to happen. However, in the spring of 2011 we can expect the cost of suburban housing in the most popular villages (subject to the stability of economic and political situation). In the less attractive sites prices will not rise, because currently offers a large amount, and demand has not yet approached the pre-crisis levels. Moreover, towns with a failed concept, with inadequate market today declared prices, frozen construction projects awaits further stimulated price declines, analysts said On the other hand, we can predict a positive correction in prices in some towns in the early stages of construction, if the other characteristics are superior to competitors. This is due to the fact that, despite the large settlements of the offer, the market is lacking a really interesting project in terms of concept, location, and consistency with the quality and cost of housing the expectations of potential buyers.
Content tags: cottage villages CIS
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