Uncompromising renters still run the show

Anticipated fall in rental rates fails to occur

By Darya Melekhova

Those in rented flats and students in hostels had been hoping that rents might fall in October but this now seems unlikely, despite the stabilisation of the exchange rate of the Belarusian Rouble and the appearance of foreign currency in free access at exchange offices.

Access to US Dollars and Euros has slightly reduced prices, with the average rental in October being almost the same as it was in August, according to Tvoya Stolitsa Real Estate Agency. In late summer, one roomed flats were being offered at $204 per month, but have now risen to $207. Two roomed flat are down to $265 from $286 while three roomed flats are currently being rented for $321 rather than $329. The prices generally include all utility bills.

Traditionally, the cheapest housing is located in the suburbs, with one roomed flats situated within a 10-15 minute drive of main streets costing around $150 monthly. Those in good repair and including furniture can fetch $200 or more depending on their distance from a metro station. The price of two roomed flats varies from $200 to $250 while prices for three roomed flats start at $250. The latter are usually viewed by young people seeking to flat share, with each having their own room.
Those who anticipated housing prices falling are likely to be pleased but experienced specialists warn against too much optimism regarding prices. “Since the beginning of the year, many changes have occurred on the market,” notes Svetlana Zygmantovich, the Head of the Rental Department at Novoselie Real Estate Agency, sharing her observations. “In most cases, tenants are still calculating using the old US Dollar-Belarusian Rouble exchange rate.”

“We set the prices ourselves, adjusting them to demand,” explains Yelena Aleinik, who heads Molnar Real Estate Agency’s Rental Department. “However, some stubborn residents would rather lose money than drop prices, leaving their flat to stand empty for a month.”

According to specialists, when access to US Dollars was lost, landlords reduced prices. Now, almost half are insisting on payment in foreign currency. Of course, those seeking rented accommodation may be able to negotiate during a personal meeting. “Landlords aren’t really looking at the personal characteristics of their tenants but advance payment deposits and guarantees of payment in foreign currency. Where these can be agreed, 30 percent arrange to reduce prices,” reveals Natalia Radenya, the Head of Tvoya Stolitsa’s Rental Department.

Even specialists disagree on how the situation may develop. Ms. Zygmantovich believes that rental rates will depend on salary growth while Molnar Real Estate Agency’s Yelena Aleinik doubts rents will fall until the new year. She explains, “They’ll remain at their current level and may even rise provided the US Dollar stays stable,” explains the specialist.

Tvoya Stolitsa Agency has the most optimistic forecast. “By the end of the year, prices should fall by another $20. Moreover, by February, demand should have fallen,” notes Ms. Radenya. “The situation currently observed is a result of rents being out of kilter with salaries.”

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