Housing Woes in Russia
* The Communist-era promise--Under guidelines lingering from the Communist era, every Russian family is promised a separate house or apartment with a minimum of 130 square feet per person. Yet across the Russian Federation, 7 million families--14% of the population--never received that minimum space. In St. Petersburg, families on lists awaiting adequate housing now get by with an average of 60 square feet per person.
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* While they wait--Many Russians still seeking adequate housing languish in one room of a parent’s apartment, often well into their 30s and when they have grown children of their own.
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* In search of solutions--In St. Petersburg and Moscow, officials are working out strategies for luring families with their own resources off waiting lists by giving them priority for scarce mortgage loans or credit for turning over their current substandard housing to others on the lists who can make do with less space.
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* The trouble with mortgages--Inflation was long the biggest deterrent to mortgage lending in Russia, as bankers were loath to extend loans when prices and interest rates were going up 50%, 100%, even 2,000% a year. A tight fiscal policy has brought annual inflation down to about 9%, and the forecast for next year is even lower. A few home-mortgage loans are already available from private lenders, and a Russian equivalent of the Federal National Mortgage Assn.--Fannie Mae, a U.S. government-sponsored corporation that purchases mortgages from lenders to help low- to moderate-income home buyers--is expected soon. By next year, several thousand home loans should be on offer to first-time buyers throughout Russia.
