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Construction boom in Arkhangelsk

Construction of new apartment block in Arkhangelsk. Photo: Trude Pettersen

Prices for new apartments in Arkhangelsk continue to grow faster than the speed of construction.

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According to the regional Minister of Construction - Housing and Public Utilities, the volume of housing construction in the Arkhangelsk region grew by 6.6 percent in 2012, reports Dvinaland. Thus, almost 270,000 square meters of housing were taken into use in 2012. In comparison, according to Murmanskstat, total volume of housing taken into use in the Murmansk region in 2012 is 24,326 square meters. That is a 4.9 percent growth in comparison with 2011. 

The two cities with highest new construction volume were Arkhangelsk City with 70,400 new square meters of housing and Kotlas with 22,100 square meters in 2012.   

However, if comparing the volumes of new housing construction in 2012 and 2011, the leader is undoubtedly the town of Koryazhma with a threefold increase in the number of new houses.  The outsiders within this parameter in 2012 are Novodvinsk with 27 percent and Severodvinsk with 45 percent of the 2011 volume of new housing construction. 

At the same time News29.ru reports that Q3 of 2012 had a price growth of 45 percent on the real estate market in Arkhangelsk comparing to the similar period in 2011. A new one-room flat in the downtown in Arkhangelsk may cost around 2.5 million rubles (€62,500) on an average, thus, a price for a square meter can reach 68,000 rubles (€1,700), according to News29.ru  

Experts believe that this price-growing tendency will continue because the purchasing power of the Northerners remains unchanged.  Besides, the home mortgage is becoming more affordable in the region. Real estate market goes behind the constantly growing demand of the people in Arkhangelsk to improve their housing conditions, since construction of a dwelling is quite a time-consuming process. The result is in the growing price for the square meter of a new flat. 

Arkhangelsk Regional Ministry of Construction assumes that the saturation of the real estate market can occur only providing constant increase in the housing construction volumes. Only in this case the prices will go down in the region.