Temporary apartments, often used by foreign businessmen on business trips, are increasing in popularity on Moscow's real estate market, consulting company IntermarkSavills said in a report.
Moscow may see a boom in the segment of temporary apartments over the next two to three years, with the largest fraction being sold in the premium property market, said Dmitry Khalin, head of strategic consulting at IntermarkSavills.
Developers will also build more temporary apartment complexes in the business-class and economy-class segments on the outskirts of Moscow, he said in the report.
Temporary apartments have a special legal status under Russian law that, among other things, forbids permanent registration at the location.
According to the report, there were 680 temporary apartments, or 121,000 square meters, in residential complexes at the beginning of April.
Premium-class apartments made up 65 percent of that number, while 23 percent and 12 percent were in the business-class and economy-class segments, respectively, the report said.
Temporary apartments are often part of multifunctional complexes, such as Gorod Stolits and Imeria Tower in Moskva-City, that also include offices, hotels and retail spaces.
The major customers buying temporary apartments in the premium-class and business-class segments are Russian and foreign companies that aim to provide housing for their staff, the report said.
Such apartments are also popular with Russian and foreign businessmen who regularly visit the capital on business trips, as well as those who commute fr om outside the city but sometimes need local housing.
Customers prefer such temporary apartments because of convenience, prestige, proximity to the office and the ability to buy additional housing space while remaining registered at another location, the report said.
"For most customers, such housing is first of all a trendy purchase — often used to conduct company business," it said.
At the same time, buying an economy-class temporary apartment may be a lucrative deal, since prices for temporary apartments are usually lower than those for ordinary ones.
Apartments in business complexes are in especially high demand, since they are located in the same building as the offices, the report said.
Businessmen, mostly men ranging in age fr om 35 to 50, as well as top managers of large companies and government employees are the main demographics purchasing temporary apartments, the report said.
But demand for temporary housing in Moscow is still very lim ited because customers are concerned about the legal status of such apartments and the inability to get permanent registration at these locations, the report said.
"Therefore, the targeted consumers of temporary apartments are substantially more restricted than those of ordinary apartments," it said.
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