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Changing Make-up of Expats Renting Apartments

2009 was characterized by a change in the make-up of expats renting elite apartments. Foreign employees who work in Russian and international companies make up about one third of the total number of clients renting apartments. Most of these were citizens of the US and UK before the pre-crisis period. Today the situation has changed. According to our analytical data the share of clients from the US and UK was more than 63% in the years running up to 2009, but today this number has decreased by 17%. However, employees from Germany, France and a few other countries have increased their presence on the Russian market by nearly 17%.

So what is the cause of such drastic change? Surely some “analysts” will say it’s all due to Global Warming or may be Penguin Migration, however the truth lies much deeper. MONEY!!! Some have it, some don’t. Prior to the global financial crisis, the Russian market was dominated by American and British investments, but after the crash in 2008 the picture has changed. Brits and Americans have pulled their investments out of Russia and created a unique window of opportunity for European companies to present themselves in Russia. And they didn’t wait long, as well as they shouldn’t have. Russia is a great market for investments and it needs serious investors. So who are these new employees, tenants, clients? And where do they live?

Some of the French expats prefer to live in the area near Chistye Prudy and Kitai- Gorod. The reason is that they need to enroll their children in the French school which is conveniently located in the area. Proximity to a school or kindergarten is very important for all expatriates who travel to Russia with their families. About 40% of all expats come to work in Russia with their family members.

Share of foreign tenants for different countries January – September 2008

This year many residential complexes located near such schools have a great number of good apartments for rent. For example, the Pokrovskoye-Glebovo complex, near the English-American School is offering quite a number of properties due to the departure of many American and British employees who earlier lived there. Some of them left Russia because their companies closed projects. Others decided that the financial crisis would crush the Russian economy and therefore they should find another job. Previously there was a waiting list to get into complexes near the school. This year however it is absolutely free to get in and at a lower price. But for the most part, expats chose a residence near their offices, which are usually located in Moscow’s historical center. Interestingly, over the same period July – September of last year, there was a serious deficit in high quality offers.

The market has changed and clients have changed. What the new changes will bring is unclear, but what is certain is that Russians will have another opportunity to show their great hospitality, and if, in previous years, mostly the Americans and British enjoyed this tradition, it is now the turn of Continental nationalities.

Share of foreign tenants for different countries September 2008 – September 2009