RUSSIA / SPOTLIGHT
When the Soviet Union was in power, each citizen had a
legal right to a home. However, as the government retained ownership of
the properties, there were strict controls in place to prevent residents from selling
or moving. Now, with privatization, new construction and the rise of the rental
market, how are today’s new property owners managing? Nikolay Vecher, CPM,
takes a look at the evolution of condominium management in Russia and the challenges and opportunities that go along with it.
HOUSING DURING THE SOVIET UNION
In the Soviet era, all residences belonged to the state. They were allotted to citizens through a complicated queue system that typically stretched for many years,
and in some cases, even decades. As a citizen’s right, apartments were assigned to
each individual by the local district administration, but the apartment never truly
belonged to the tenant. In other words, the resident could live freely in his or her
apartment, but could not move or sell without government approval.
Residents were responsible for paying utility bills along with some maintenance
costs. Because the law did not clearly establish a mechanism of eviction for late
payments, very few people were evicted.
AFTER THE SOVIET COLLAPSE
With the collapse of the Soviet system in the 1990s, large-scale privatization of
apartments began and still continues to this day. Each citizen was granted ownership of his or her current residence, free of charge. Privatization of an apartment
could only be realized once in a lifetime and only by the tenant holding the resident’s permit.
As a result of this free privatization in Russia, a new class of homeowners was
created. Adding in those who had houses built and rent out their apartments for
result, the management and maintenance industries have progressed to meet the
needs created by the evolving housing system.
THE CURRENT STATE OF
Russian condominiums usually have
more than 700 to 800 units, as well as
many non-residential spaces like cellars,
attics and various technical and utility rooms. Typically, a general owner’s
meeting is held to determine the way
the property should be managed, but
getting so many residents on the same
page is nearly impossible. Therefore,
condo owners usually follow the path of
least resistance—enlisting the services
of a specialized management company.
The Russian HOA is a complete analogue of an American Home Owners
Association. HOAs are a common occurrence mainly for smaller properties,
such as where I live. My residence has
only 72 units in total, a small building
by Russian standards.
My building is representative of new
housing standards in Russia. Constructed ten years ago in the center of St. Petersburg, it has a number of non-residential spaces and underground parking in
addition to its residential units. On the
grounds around the building, the HOA
included an additional parking lot as
well as a playground and a landscaped
garden. The HOA makes additional
income charging for parking and placing ads on the building. The district
administration controls the activities of
the HOA through regular inspections.
The most common alternative to an
The MC is fully responsible for keeping the building up and running, and
for providing all necessary financial
services. This option is more common
among residents of large and inexpensive buildings and those built in
the Soviet era and before the October