Vladivostok apartment rent unaffordable as tenants choose cost

Apartment rentals in Vladivostok have become unaffordable for those who previously always rented housing. Some tenants have switched to apartments with more affordable prices, giving up some suitable conditions, real estate rental specialists told VLADIVOSTOK1.RU.

An apartment selection manager at one of Vladivostok«s agencies noted that due to the high pace of housing construction, apartments purchased as investments are falling in price. This especially applies to those who have been in this field for several years. Prices on many properties have to be reduced due to long vacancies.

«It doesn»t matter if it«s an elite apartment or not, the rental market is in crisis due to oversaturation. More or less loyal owners who understand the market or adapt to conditions lower the price just to rent out and receive income or cover payments. If you look at Farpost, we see that prices have risen significantly; now even a normal studio apartment for 25,000 or 28,000 rubles (about $250-$280 at current rates) is not guaranteed to be taken. But everything is standing idle. The key rate has had an impact, prices have risen sharply, demand has fallen sharply, especially in winter. Winter demand is already sluggish, but now it»s even worse; tenants simply don«t have the money to adapt to the market,» the interlocutor explained.

According to her, this has become very noticeable in the rental of elite real estate; last year, one could still speak of stability: it was possible to rent out 1-2 apartments per month for 300,000 rubles (about $3,000 at current rates) or more — there was demand. Now, they are not even inquired about.

This position was confirmed by realtor Yegor Sharapov, adding that the market has shifted so much that the end consumer — the tenant — is ready to completely revise their criteria for an apartment, and sometimes even prefer houses and cottages.

«In some of my properties for sale, there are tenants who value comfort, but apartments in Vladivostok have become unaffordable. Owners of »elite« apartments are not willing to concede more than 10,000-30,000 rubles (about $100-$300 at current rates), while people are asking for 100,000 rubles (about $1,000 at current rates), for example. And it»s easier for them to live in a precarious situation in a house for sale, but cheaply, constantly moving from one house to another, than to pay extra. Housing and comfort are no longer a priority for families. I think this will hit the market hard overall; we can expect a drop by the end of this year or in the first quarter of next,« the man shared his opinion.

Anastasia also noted that the mid-price segment is most in demand — studio apartments and one-bedrooms. People have stopped focusing on what is convenient for them; now the main criterion is price.

Apartments for rent on the secondary market are much less in demand, but remain at the same price level, and it grows according to trends, but people are reluctant to live there because, to a large extent, secondary housing means cockroaches, old utilities, rotten pipes, lack of heating and hot water. Another difficulty is the owners themselves, who blindly follow the prices on listing sites, but are not even willing to make minimal investments in the income-generating property.

«Often this concerns adults; they don»t understand or don«t want to understand how important it is to prepare the apartment. Cockroaches? Then the tenants will take care of it and spray themselves. Dirty? They»ll take a rag and clean up. They are not even willing to give a discount for it to be clean. And, of course, such apartments stand idle and maintain a price that is clearly inflated. Young people are ready for new constructions and want them, where such problems usually don«t exist. And the owners are often client-oriented,» Anastasia explained.

The rental market in Vladivostok has faced changes that specialists last noted in 2019, when supply exceeded demand. Several factors could have influenced this, but the most key ones are the high pace of real estate construction, preferential mortgages, and the low level of wage growth.

According to specialists, price growth is still possible, but not by much, largely due to the population«s insolvency. Also, the human factor and the unawareness of apartment owners about the real situation in the real estate market and basic figures for understanding tenant solvency play a big role.