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. Last Updated: 07/27/2016

Young Rich Prefer the City Life

Knight FrankMoscow apartments rival suburban houses in price, with a square meter going for up to $25,000 and climbing.
Demand for luxury apartments within the city limits and close to business centers is growing, fueled by a crop of well-heeled young people who find the smoke of nightclubs more attractive than the fresh air of a Rublyovka backyard.

People who can plunk down $5 million for a home still prefer living in the suburbs, not in a penthouse, said Ivan Shulkov from Usadba, a real estate agency specializing in luxury housing.

But people with that kind of money are also keen on owning a place in the city -- meaning that the demand for Moscow apartments is not denting the sales of mansions on Rublyovskoye Shosse and other areas in the city's outskirts.

Moscow apartments also rival suburban houses in terms of prices. One square meter goes for up to $25,000, and real estate agents expect the price to keep increasing. The prices are boosted by a lack of space in Moscow.

Trying to squeeze every penny possible, developers give preference to elite housing.

Most of the wealthy buyers are young people in their 20s, and they appreciate the convenience of the location, said Nuri Katz, president of Century 21 Russia. As in London and New York, the young and rich value being close to their offices and entertainment venues more than fresh air and backyards for the children to play.

They will move out of the city when they settle down and the infrastructure of Moscow suburbs improves, Katz said.

The twentysomethings come with specific housing needs. The most popular are smaller studio and two-room designer apartments, said Irina Zharova-Rait, of the real estate agency Sesegar. One of the top requests from new owners is that the space be organized in such a way that service personnel can work without being seen much.

The location of elite housing is determined by the infrastructure of the area. Developers prefer to reconstruct whole districts, such as Ostozhenka in the center of Moscow.


For MT
The most popular homes are studio and two-room designer apartments.
Shulkov said the Sretenka area, close to Tsvetnoi Bulvar, could be overhauled the same way.

The situation is different in the historic center of the capital, where only small projects can be developed. The presence of restaurants and boutiques can play a crucial role, as they did in boosting the popularity of Patriarch's Ponds as an elite neighborhood.

The trend often goes in reverse, with the construction of elite apartments stimulating development in a neighborhood. Khamovniky emerged recently as an elite district thanks to it comfortable transportation system and parks. As a result, new restaurants and fitness centers are mushrooming in the area.

Other elite oases are planned for former industrial zones, such as the area around the former Kornet factory in Zamoskvorechiye and Taras Shevchenko Naberezhnaya, which used to be dotted with factories.