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. Last Updated: 07/27/2016

Mayor Addresses Flat Scams

In an attempt to stem "housing crime" -- the swindling or murder of vulnerable apartment-owners for their property -- the Moscow government has ruled it illegal to deal in real estate without a city license.

According to a decree Mayor Yury Luzhkov signed last November, all Moscow realtors are required to register with the city housing department, deputy housing director Nikolai Maslov told a press conference on Thursday. Of the 1,400 real estate agencies working in Moscow today, only about 90 are licensed so far, he said. The law went into force Wednesday.

High real estate values, coupled with taxes up to 30 percent on property sales, have given rise to a unique breed of local criminal -- shady agents who "will look an old babushka in the eye and say, 'Trust me' to our ignorant and credulous people," Maslov said.

Their clients have ended up homeless, or -- in cases where elderly people sold the rights to their apartments after they died -- murdered under mysterious circumstances. Although Maslov did not give recent statistics for housing crimes, the city government attributed 30 murders and 14 kidnapping or extortion cases to apartment scams in one three-month period last year.

As the Moscow government bolsters its fight against housing crime, the real estate market becomes more and more regulated. Last summer, the city government forbade vulnerable people such as the elderly, the mentally ill and alcoholics to sell their flats without city permission. Furthermore, Luzhkov has established a preventive housing crime unit within the city police department.

Alexander Strelkov, president of the Russian Guild of Realtors, said he backed the move. "It gives us a certain status in the eyes of the consumer," he said.

The licensing process takes between one and two months, and is stringent enough to weed out unqualified firms, said the representative of one Western agency, who asked not to be named. Foreign firms are also required to register.