Petersburg Residential Real Estate Recovers

By Nadezhda Zaitseva

Vedomosti

Published: October 17, 2012 (Issue # 1731)

St. Petersburg’s residential real estate construction sector, which saw a decrease of nearly 40 percent on the previous year in the first half of this year, is once again nearing last year’s level.

In the first nine months of this year, 1.4 million square meters of residential real estate were launched in the city, 4.1 percent less than by the same time last year. In the first half of the year, the volume of accommodation built — 541,400 square meters — was 38 percent less than in the previous year.

The sluggishness of the authorities caused by the procedure for approving planning projects is not reflected on the market, said Andrei Tetysh, chairman of the board of directors of the Real Estate Research and Development Agency (ARIN).

As a rule, the second half of the year sees the lion’s share of new construction completed, and the year’s results will likely be comparable to last year’s (2.7 million square meters), said a representative of Setl Group. Setl launched 55,000 square meters in the Vena complex in the third quarter, and plans to build another 110,000 square meters by the end of the year.

Etalon Group developer plans to launch most of its properties in the final quarter, said Anton Yevdokimov, the group’s financial director, via the company’s press service.

About 1.9 million square meters of residential real estate have gone on sale since the beginning of the year, said Andrei Veresov, general director of the Novy Peterburg group of companies.

According to data from Peterburgskaya Nedvizhimost real estate company, in the first nine months of last year, 1.8 million square meters of accommodation was launched in the city.

Since the beginning of this year, prices have risen by 8.6 percent to an average of 83,000 rubles ($2,674) per square meter, said Veresov.

According to data from Etalon, the average price of residential real estate in the third quarter of this year rose by 9 percent compared to the same period last year, up to 74,000 rubles ($2,384) per square meter.

Future active growth on the market may be hindered by the large volume of basic “economy-class” housing on offer in buildings being constructed in areas just outside the city, said Vasily Selivanov, general director of Legenda Intelligent Development.