A very tempting idea for many people is to buy a renovated house in Moscow. Is it worth buying an apartment in buildings that are subject to renovation? What risks exist when purchasing apartments in a renovated building?
Renovation in modern construction is the replacement of old and worn-out housing with new and comfortable ones. Renovation in Moscow started in 2021. Within a year of its launch, it has gained momentum and is moving by leaps and bounds citizens from dilapidated buildings into modern, comfortable homes. This program is designed for 15 years or more and involves the resettlement of about 1 million families. Such a large-scale program had a noticeable impact on the situation in the capital’s real estate market. We will answer the question, is it worth buying an apartment for renovation in Moscow and where will the houses cost for housing allocation after demolition?
Is it possible to buy an apartment in a building for renovation?
Based on regional and federal regulations, it is allowed to buy apartments in such buildings.
Is it possible to buy a room?
Under the renovation program, room owners (shareholders) also receive new housing. Selling and buying a share in real estate is allowed on the same basis as a separate apartment.
Who buys apartments in five-story buildings?
Most often, buyers of housing included in the list of houses being resettled are citizens who want to make a profitable investment of their funds. As a result, they will be able to obtain more liquid and expensive real estate at a price below the market.
What are the risks?
- By law, a program participant must sign an agreement with the Renovation Fund that they will be able to obtain ownership of new housing within several years. But if the Foundation is liquidated, then it will not be possible to become the legal owner. There are no prerequisites for this now, but if the economic situation changes, they may appear.
- It will not be possible to sell the received apartment immediately, since it will not be transferred to ownership immediately. The registration process can take up to six months due to paperwork.
- When selling an apartment purchased between 01/01/2016 and 12/31/2019, its owner must pay personal income tax if he sells it within 5 years. For apartments purchased before 2021 or after 2021, this period is 3 years. But there are separate conditions for the renovation program. The period of ownership of the new property also includes the period during which the previous housing in the Khrushchev-era building was owned. This makes resale easier, but you will have to wait a while after moving to avoid paying the 13% tax.
- The schedule for the demolition of houses for renovation 2020-2025 has not yet been approved, so the exact time frame for obtaining a new apartment is unknown and may take 5-10 years. The third wave of resettlement will begin after the construction of new buildings on the site of the former five-story buildings, and for this they need to be completely resettled, demolished and the construction site prepared.
- There is also a risk of mass development, real estate experts say. If three or four more high-rise buildings for commercial sales are built on the launch sites, along with a house for migrants, then the number of offers on the market will be inflated and prices will have to be reduced.
- Finally, the object may be excluded from the program. An initiative group of residents can hold a meeting and arrange a re-vote. If more than 2/3 of the owners refuse to participate in the housing reform, then the previous decision can be appealed, and the house will be removed from the renovation list.
Is it worth buying an apartment for renovation in Moscow?
There is a sense in purchasing such housing:
- there is an opportunity to get a comfort class apartment in a modern house;
- it will legally meet all sanitary requirements and housing standards;
- the infrastructure in the area of residence will improve;
- the price of the new home will in any case be more than what you paid for the old apartment.
Take it or wait
Should you agree to loan terms for demolished housing or wait until the current owner receives an apartment in a new building under the relocation program? It all depends on the specific situation - if the family has a place to live, then you can wait a little:
- The bank will be more willing to issue money for new housing;
- In addition, you won’t have to take a “pig in a poke” - what if the new property doesn’t suit you due to some parameters (the floor is too high, not the “right” area, the windows overlook the courtyard, but I would like to be on the highway, for example, and so on ).
If the family has nowhere to live, then bank money for the demolished living space is not the worst option.
What should a Khrushchev-era tenant do with a mortgage agreement? Continue to pay the loan as before. In general, nothing will change for him - the change will occur only in the real estate itself, which is the collateral.
The cost of apartments in five-story buildings for demolition
In such buildings, prices for apartments are usually higher than in similar buildings that are not intended to be demolished. In Moscow, the cost of one square in a Khrushchev-era building for demolition can vary from 145,000 to 303,000 rubles. This price is due to high demand and the number of people willing to invest in promising real estate. Compared to 2021, before the announcement of the launch of the second wave of renovation, the increase in prices for Khrushchev buildings amounted to 20%.
conducted a study and found that the number of investors purchasing apartments in the old building, which will be resettled under the renovation project, increased from 8.5% to 17%.
In February 2021, the real estate market offers the following prices for apartments in five-story buildings in the capital (according to the websites Tsian and Avito):
| Room | One-room apartment | Kopeck piece | Treshka | 4 or more | |
| Price, rub | 2.900.000 — 6.000.000 | 3.800.000 — 13.300.000 | 4.400.000 — 13.500.000 | 6.500.000 — 14.500.000 | 11.150.000 — 19.900.000 |
| Area, m2 | 13 — 23 | 27 — 36 | 41 — 57 | 51 — 81 | 59 — 128 |
The cheapest option is a one-room apartment with an area of 27 square meters. m, located in the Troitsky Autonomous Okrug, 26 km from the Moscow Ring Road along the Kaluga Highway, in a 4-story brick building on the 1st floor. It is put up for sale for 3.8 million rubles.
The most expensive offer is a 4-room apartment of 128 square meters on the 4th floor of a 5-story brick building, which is located in the Donskoy district (Southern Administrative District) on Varshavskoe highway. The starting price is 19.9 million rubles, but may be increased in the near future.
Western District
Houses on the queue for 2021 - 2021:
- Kuntsevo: st. Molodogvardeyskaya, 44;
- st. Bobruiskaya, ow. 15.
From 2022:
- Mozhaisk district: st. Grodnenskaya, vl. 7-9;
- Vernadsky Avenue: Vernadsky Avenue, vld. 75/3;
- Solntsevo: st. Rodnikovaya, vld. 4/1.
How to protect yourself when purchasing?
In order not to lose money in transactions with apartments for renovation, you need to take into account certain restrictions:
- check whether the owner has entered into an agreement to transfer his apartment to local authorities;
- find out whether or not an agreement to buy the apartment was drawn up;
- find out if there is a court decision to forcibly evict the owner (if he refused to move due to renovation and did not agree to monetary compensation);
- make sure that the property belongs to the owner by right of ownership (it may be on the balance sheet of the municipality, and the person lives under a social tenancy agreement);
- check whether there is an encumbrance placed on the housing (by a bank or court).
Rules for real estate transactions on the secondary market
When purchasing a secondary product, you need to consider the following details:
- Check the owner’s passport and all documents for the apartment: whether it legally belongs to him.
- Check everyone registered. To do this, you should request an extract from the house register. It is better to discharge minors before entering into a transaction.
- Checks the technical passport of the object. Check it to see if there have been any redevelopments. If there were, then they must have permission.
- Before concluding an agreement, you need to agree on the exact amount and method of transferring money and reflect this in the agreement.
To pay, the safest way is to use the services of a bank and rent a safe deposit box there through which the money will be transferred. Or another option is to open a letter of credit.
Do they provide mortgages for apartments for renovation?
To purchase real estate if you lack your own funds, you can take out a mortgage loan. In this case, the apartment will be registered as collateral. But banks prefer to invest in assets that can be easily sold if necessary. Therefore, if the housing is very old or the house is in disrepair, the bank will not accept it and will refuse a mortgage.
If real estate in Khrushchev was purchased with a mortgage, then according to Law No. 102-FZ “On Mortgages”, the terms of the mortgage loan should not change when relocating. Only the collateral will change – it will become a new apartment issued by the state. Re-registration occurs automatically.
Which banks will provide a mortgage in a renovated house?
You can get a loan from any bank; the determining factor is the property, not the structure. You can apply to:
- Sberbank;
- Gazprombank;
- Opening;
- VTB 24 and others.
Reference. The bank makes a mortgage decision not only depending on the condition of the apartment. The borrower must also meet all requirements set by the credit institution.
Sometimes you can find offers from some banks about preferential mortgages for renovation. In fact, this may turn out to be an advertising ploy: the person will either be refused or offered conditions that are not as favorable as those mentioned in the advertisement. Some lending programs have strict requirements regarding the year of construction or series of five-story buildings.
Sale of apartments in five-story buildings for renovation
When selling a home in a house that is included in the resettlement program, some legal nuances must be observed.
Is it possible to sell an apartment for demolition?
Only the owner can sell housing in a dilapidated building, setting the price for it himself. There is a condition - he must notify the buyer about the status of the house. Otherwise, the court may declare such a transaction invalid.
Important! It will not be possible to re-register an apartment if the owner has already signed an agreement to repossess the property, or there is an agreement with local authorities on the purchase of the property.
Why are these apartments being sold?
The deadline for providing a new living space is not always known exactly, and some people do not want to wait “by the sea for weather.” It may turn out that the housing issue needs to be resolved urgently, for example, when dividing property after a divorce. And sometimes people want to move to live in another district or city, then there is no point in waiting for resettlement. In such cases, selling an apartment is a good option for solving housing problems.
Renovation: more about the essence of the program
The Moscow renovation program first appeared in the 1990s, when the mayor of the capital, Yuri Luzhkov, selected five-story buildings of certain categories (K-7, II-32, II-35, etc.) for demolition. At that time, the authorities were unable to fully implement the project, which was partly due to a lack of money in the state budget. The current mayor of Moscow, Sergei Sobyanin, proposed resuming the program to renew the housing stock in 2021.
Capital renovation refers to a set of actions aimed at demolishing old residential buildings (usually five-story “Khrushchev” buildings). The permissible lifespan of the Khrushchev buildings has either already expired or will end in the very near future. The main task of the renovation is to prevent five-story buildings from turning into unsafe and uninhabitable structures that will pose a danger to Muscovites.
The authorities decided to take the path of demolition of houses, and not along the path of their reconstruction and repair (with the exception of objects representing valuable cultural heritage). This is due to the fact that demolishing the Khrushchev buildings is both more profitable and safer for people.
Citizens living in demolition houses have the opportunity to move to modern and comfortable new buildings. Here they are provided with apartments of equal size, but improved in their technical characteristics. In some ways, the relocated residents will even benefit. The number of rooms will remain the same in the new and old housing options, but the hallway, kitchen and bathroom will definitely become more spacious.
If a person has the financial opportunity, he can pay extra for the “extra” meters and increase his home even more. At the same time, there will be no need to move far from your usual place of life, because the new buildings will be located in the same places as the demolished houses.
If the current owner does not want to receive housing in a new building, he can receive monetary compensation . The amount of monetary compensation corresponds to the market value of the original apartment.
How to buy an apartment in a renovated building?
It will not be possible to purchase an apartment in a building under construction. It is being built according to a state program, so the apartments in it are intended primarily for displaced people. The sale of vacant rooms will begin only after relocation and if there are unclaimed properties.
The easiest way is to buy real estate in a renovation building when new owners start selling them. Sale advertisements can be found on Avito or Cian. However, at the same time, prices will be higher than at the construction stage.
Another option is to try to buy a home for which no legal owner has been found under the program. In such a situation, unclaimed apartments are put up for auction. Information about such proposals is published on the website of the Renovation Fund fr.mos.ru.
Advice. We also need to think about new neighbors. If people from emergency housing are moving into this house, the contingent may not be the best.
Didn't find the answer to your question? Find out how to solve your problem - call and consult with a lawyer: 8 (Moscow and Moscow Region from 9:00 to 20:00) Consultations are provided within the program free of charge.
North-Eastern District
For current and next years:
- Alekseevsky district: st. Staroalekseevskaya, ow. 3.
- Butyrsky district: microdistrict. 78, bldg. 66;
- st. Rustaveli, vl. 3, bldg. 4.
- Dmitrovskoe highway, ow. 167, bldg. 4A;
2022:
- Babushkinsky district: Ostashkovskaya street, vl. 9/2;
- Bibirevo: st. Belozerskaya, ow. 3-5;
- Butyrsky district: st. Milashenkova, ow. 7/3;
- Losinoostrovsky district: Taininskaya st., vld. 9/5;
- Maryina Roshcha: st. Annenskaya, vl. 6;
- Otradnoe: st. Olonetskaya, ow. 21.
