Get the latest updates as we post them — right on your browser

. Last Updated: 07/27/2016

Property Deals at Risk of Stalling Next Year

ST. PETERSBURG -- All real estate deals in St. Petersburg and the surrounding Leningrad region may stall from Jan. 1 due to the bureaucratic problems that are expected to erupt when the two sides' property registers are united, real estate agencies and lawyers said.

The Justice Ministry ordered the unification several weeks ago as it aims to bring St. Petersburg's system into line with those elsewhere in the country. Part of the change will see property registration periods extended to a month, as it is elsewhere in Russia.

"Real estate deals will get stuck," said Natalya Yemuranova, a member of the St. Petersburg Collegium of Lawyers, who chaired a round table on security issues at the American Chamber of Commerce on Monday.

"This will cause problems for everyone," she said. "If it takes five days to register a deal now, from Jan. 1 it will take one month. It won't be just terrible; it's going to be terrible times three."

St. Petersburg's real estate registration system, which has been developed over the last 10 years and seems much more advanced than those used elsewhere in the country, could be destroyed, Yemuranova said.

"This way the reorganization that is taking place at the moment cannot be described as anything other than a distraction," she said.

Last week, the St. Petersburg Association of Realtors appealed to St. Petersburg Governor Valentina Matviyenko to postpone the merger to avoid harming the city's real estate market. If the merger takes place, it will damage the interests of more than 70 percent of applicants who prefer to register their deals as they have been doing, the appeal said.

The realtors also said the changes would harm the market in communal apartments purchased by investors. These investments improve the city's housing stock and save apartment buildings from falling apart if their residents cannot afford to restore them.

Galina Volchetskya, head of the St. Petersburg registration bureau, confirmed that the time needed to register real estate deals will be extended to one month, as it is for the rest of the country.

At the same time, she acknowledged that her office is not ready for the reform.

"The regional office of the Russian State Registry has not been created," Volchetskaya said, Delovoi Peterburg reported.

"We don't yet have a description on how we should transfer to the new system, many questions have not been cleared up, starting with application forms and stamps and finishing with staff."