Construction of Housing in the Urals Can Decrease Catastrophically

08.05.2009 — News

Urals Federal District.

786 thousand square metres of housing was commissioned in the Urals Federal District regions in the first quarter of 2009. The volumes dropped 14% in comparison with the same period last year.

Having commissioned 216 thousand square metres, the Sverdlovsk Oblast exceeded last year's figure by 2.6%. Ekaterinburg accounts for more than one third of the volume (78 thousand square metres). Slightly less - 72.8 thousand square metres was commissioned in the whole of the Kurgan Oblast. Nevertheless, the regional builders have exceeded the January-March 2008 result by 34.

In the Tyumen Oblast the construction volumes are 5.1% down. 259 thousand square metres were commissioned in the first quarter. The regional Government informed RusBusinessNews that despite the economic crisis all houses being built will be completed because housing is still in demand. The construction industry will be supported by the Oblast budget resources.

179 thousand square metres of housing was commissioned in the first quarter in the Chelyabinsk Oblast, which is 36% less than in January-March of 2008. A more substantial drop has been registered in the northern regions of the Urals Federal District. Volumes of construction dropped by 44% (7.6 thousand square metres) in Yamal and by 53.7% (51.9 thousand square metres) in Ugra.

The Urals experts forecast that in the second quarter of 2009 the construction indicators will be much worse and that in the second half of the year the Urals Federal District and Russia as a whole will see a catastrophic slump in housing construction. For instance the construction of 38 houses with the total floor space of 278 thousand square metres has already been stopped in the Sverdlovsk Oblast since the beginning of the year due to financial problems.

A further reduction of housing prices can create a momentum to help return to previous construction rates. On average, since the beginning of the crisis housing prices have gone 12-15% down in the majority of the Urals regions. Nevertheless, while the real value of a square metre of housing in Ekaterinburg at 30 thousand roubles, it is offered in the market at more than 50 thousand roubles. In the Tyumen Oblast the price of one square meter in a new building is 40.7 thousand roubles, in Yamal - 48.4 thousand roubles, and in Ugra - 49.5 thousand roubles.