Senior Russian Officials Debate Soaring Housing Prices: Media Mocks Duma Members’ Extensive Involvement in Real Estate
On November 14, Russia is Not Europe published an analysis of recent discussions within Russia’s political elite regarding housing affordability.
A debate over housing policy is rapidly gaining traction among senior Russian officials. Following Central Bank Governor Elvira Nabiullina’s remark—“The public needs affordable housing, not easily accessible mortgages”—that sparked controversy, State Duma Chairman Vyacheslav Volodin echoed the sentiment with a similar line of argument:
“The President has assigned us a task: pricing must be reasonable, and per-square-meter prices should be reasonable as well. Please present the evidence supporting your figures. A 50% annual increase in housing prices is simply unsustainable. Can we not see this clearly?”
Volodin directed officials from the Ministry of Construction to clarify the mechanisms behind housing pricing and immediately implement stringent measures to address market distortions. He then advanced another striking assertion: if households are required to allocate a significant portion of their income toward mortgage repayments, there will be little left for other forms of consumption.
The reality aligns with this assessment: many Russians struggle to afford even mortgage payments, let alone other living expenses. According to data from the Russian Housing Development Group, the average monthly mortgage payment in Russia now stands at 71,000 rubles, while the median post-tax salary is just 62,000 rubles. This means that a dual-income household’s total earnings barely cover mortgage obligations and utility bills. After deducting these costs, the remaining disposable income for each spouse approaches the minimum subsistence level. Yet, officials appear to assume this amount suffices for basic needs such as food, clothing, and public transportation.
The article notes that Russia’s housing affordability crisis indeed demands urgent attention. However, housing prices are not set by the Ministry of Construction but determined by developers. Thus, Volodin would be better served directing scrutiny elsewhere. Consider, for instance, Maxim Vorobyev—the son of a Federation Council deputy and brother of the Moscow Oblast governor—who has direct ties to the major developer “Aircraft Group.” Or Ilia Volkson, a State Duma representative from Tatarstan and founder of the local real estate firm SMU-88 (though he claims not to be its sole owner). Also notable are Vladimir Koshelev, Roman Rabikhov, and Nikolai Alekseyenko—current and former heads of the State Duma’s Committee on Construction and Housing Utilities—all of whom are themselves involved in real estate development.
The article argues that given the extensive presence of real estate entrepreneurs within the State Duma, discussions on housing prices might be more appropriately conducted among deputies themselves rather than with the Ministry of Construction. Imagine a developer-turned-deputy standing before his peers, addressing fellow developers with a stern tone: “Colleagues, are we not profiting excessively?”
Original source: toutiao.com/article/1881821042001984/
Disclaimer: The views expressed in this article are those of the author.