Mark Adomanis: Moscow Just Set A Record For Residential Construction
It would be logical to expect that 2015 saw the beginnings of a sharp correction. Russians’ real, inflation-adjusted, incomes fell by around 10%, already high interest rates spiked dramatically, and unemployment started to creep higher. That’s a combination that really should substantially crimp output of new housing, or at least prevent it from rising. People had significantly less money to spend, expectations of future economic conditions were turning sour, and borrowing was much more expensive.
Despite all of that Russia’s housing industry chugged ahead in 2015, with Moscow setting a new record with about 3.8 million square meters of new construction. In square feet terms that’s about 41 million, or 41,000 new apartments assuming an average size of 1,000 square feet per apartment. For comparison’s sake, that would mean Moscow completed around three times as many new apartments as supposedly “booming” New York managed to in 2014.