With expectations that the rental market for elite housing is returning to life, owners are stepping back in and asking high prices, but demand has not yet recovered from its record fall last year.
The share of owners offering apartments for more than $9,000 increased to 15 percent February, up from 12 percent the month before, Penny Lane Realty said in a report last week.
Landlords of elite apartments have begun cautiously returning after an unwillingness to lower prices forced them to leave the market in droves last year. Increasing activity in the segment shows that landlords are now expecting a higher level of demand in the elite property segment, the report said.
But not all of the landlords' hopes have been justified, said Vadim Lamin, head of the luxury apartments department at Penny Lane Realty.
"Demand hasn't recovered in full so far and largely exists in the $3,000 to $8,000 price segment. The interest in high-budget apartments (from $9,000) accounts for only one-third of the supply," he said in the report.
Demand for apartments under $4,000 per month accounted for 54.3 percent of the total number of inquiries to IntermarkSavills in February, while the demand for high-budget property of $10,000 to $15,000 per month accounted for just 13 percent, the consulting company said in a report.
"People still prefer to rent more low-end apartments. There's an increasing number of Russian renters who are not ready to spend much money on renting an apartment," said Galina Tkach, director of leasing at IntermarkSavills.
She added that increases in rental price were possible within the next six months.
The average rental price for elite apartments stood at $5,840 per month in February, up from the January figure of $5,820 per month, IntermarkSavills said.
The most expensive apartment in Moscow last month was one located on Bolshaya Gruzinskaya Ulitsa, which was leased for $47,000 per month, according to Penny Lane Realty.
And just as the market for elite rentals is reviving, sales in the segment also have picked up significantly over the same period.
February saw a 30 percent month-on-month increase in the number of transactions for new apartments, IntermarkSavills said.
In the elite market segment, the average price per square meter rose 2.4 percent and reached $12,900, up from $12,600 a month earlier, it said.
"Prices for elite new apartments show an increasing tendency for growth. The average price of one square meter has risen by 6 percent since October 2009," said Dmitry Khalin, head of strategic consulting at IntermarkSavills.
"Accordingly, the growing number of closed sales indicates the beginning of a post-crisis market recovery," he said.
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