According to Vladimir Lamin, head-prime residential properties at Penny Lane, the average monthly rent is hovering around $4,000. Studio apartments are least expensive costing around $2,000 per month, whereas a 600 square meter apartment costs around $35,000 in rents each month.
“This market has traditionally been dominated by the foreign workers, but it’s the Russians who are driving the demand nowadays”, he added.
Average rentals had hit an all time high of $8,000 in 2007 as demand from foreign companies soared. However, the percentage of foreign nationals signing rent agreements have fallen to 49 percent now from 62 percent in 2007, estimates Penny Lane.
To keep costs low, many foreign companies promote local talents instead of importing expatriates. Local managers usually do not qualify for relocation and housing allowances, according to Mikhail Zhukov, head of recruitment firm HeadHunter.
“Unlike five years ago, top Russian managers now have enough experience and education to replace expatriates”, Zhukov said. “This is likely to continue next year”, he added.
The trend was visible when Nissan Motor Corporation replaced the Russia country head Fujio Hosaka with local talent Dmitri Mikhailov. Mikhailov was heading the production unit of Nissan’s manufacturing unit in St. Petersburg.
As the economy recovers from last year’s contraction, consumer spending and rising commodity prices are fuelling growth. The government is developing a technology hub in Skolkovo which will see participation by the world’s technology giants like Siemens and Cisco, fuelling demand for premium housing in Moscow.
Teri Lindeberg, founder and CEO of Moscow-based recruitment company Staffwell said: “We expect recruitment to really pick up next year”. He further added: “Russia is experiencing a much faster comeback after this crisis than the United States”.
In a report prepared by Knight Frank, the London based property broker said that ‘Elite’ homes available for rental in the second quarter fell by 14 percent compared to previous quarter since, many owners tried to sell properties off.