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The RF Prosecutor General’s Office has charged the Antimonopoly Service to verify the antimonopoly law observance by the construction companies when fixing housing prices for the possible price collusion.
"Law observance materials of the Directorate of Public Prosecutions under the national project “Available Housing” indicate that one of the principal problems restraining the successful implementation of the project in Moscow and Saint Petersburg is the unjustified rise in housing prices. Over the last years the cost of a residential square meter has increased by several times,” – according to the FAS press-service.
Mr. Evraev noted that over the last year the costs of residential space grew two-fold in Moscow and half as much again in other regions. He emphasized, “Today a residential square meter in Moscow costs about 4 thousand dollars. This price is well above the prime cost.”
The key challenge of the federal authorities is the creation of favorable environment to enjoy the considerable increase in supply. “Then the market would return to normal and we would have the prices that are not several times above the prime cost as it is now”, said the FAS representative.
Among the price increase reasons FAS representative mentioned housing shortage in Moscow and Saint Petersburg, and non-transparency of the previous land distribution scheme. Mikhail Evraev reminded that land was not auctioned off until 1 October, 2005, and often it was distributed in a targeted way. This led to the creation of local monopolies when lend was given to companies “closely connected with the federal authorities”, he added.
"Currently these local monopolies are demolished and the construction business is heading toward normal “transparent way”. We believe that this process should be accomplished in the nearest future and then we would certainly expect the considerable increase in supply at the real estate market”, said Mr. Evraev. The FAS representative expressed confidence that land auctions would not lead to the subsequent housing price increase: “notwithstanding the fact, that auctions tend to lower a building company’s income to a certain extent, they provide all building firms with the equal opportunities to participate and win. This will give good chances to more construction companies that would guarantee the actual price of a residential square meter in future”, said the official. | 
