Nowadays, buildings are built with modern materials and advanced technology, which make them more expensive than secondary housing (block building from brick or brick-monolithic). Beside materials and technology, numerous factors determine the value of residential real estate market in the state of Florida and major cities in the Russian Federation like Moscow and St. Petersburg. In this aspect, the Russian Federation and Florida real estate markets show some similarities and disparities.
In major Russian cities, like in Florida, properties located in main districts, close to industrial zones, schools, businesses and entertainment/shopping centers, historical and cultural areas make them very valuable. Other ecological factors may also have an impact on property value.
The accessibility to public transportation (metro station, bus, proximity to road junctions) can significantly increases real estate market value. In St. Petersburg, residential complexes of mass-market level like Devyatkin and Parnas are usually built near metro stations. For many people, buying a property in the residential areas of Moscow and St. Petersburg near the construction of a metro station is a profitable investment. These individuals seek to benefit from the progression and completion of the construction to see their property value increase. Such individuals may gain a return on investment of up to 40-50 percent.
In Florida, while facilities upgrades such as upgraded kitchens and bathrooms, new roof, among others, increase drastically property value, inspection reports showing damages of a property and unpopular neighborhoods are strong indicators of decrease in property value.
In Florida, economic indicators such as GDP, unemployment rate, income growth, zoning restrictions and local regulations are important factors that influence property value. Other factors that have a significant impact on real estate markets include mortgage interest, local builder activity, proximity to parks and playgrounds, noise, light and air pollution, quality of internet connection, traffic volume, and road quality. Before making a decision to purchase or build a property, it is therefore important to have a broad analysis of market conditions to know how the value of a property may fluctuate over time.
In 2017, there were on average 288 cars per 1,000 residents in the Federation of Russia, according to a survey conducted by Autostat analytical agency. In Florida, there were on average 380 cars per 1000 population in 2016. Thus, in Florida, as opposed to Russian citizens, individuals rely more on private transportation and seek to live in agreeable neighborhoods located in the outskirt of the city. This is a good option for individuals who have access to good quality roads. An example of remarkable road improvement system that benefits property owners is Wekiva Parkway, which completes the beltway around Central Florida.
For investment purposes, it is better to invest in a middle class segment property and finance it in the beginning of construction to generate higher profit. It is also profitable to establish new roads similar to Wekiva Parkway, which has an important influence on property market value and is source of profit for owners and investors.
The Author
Anna Makogonova is a Chief Project Engineer at Petrostroytrest, Russia. She prepares contracts for construction design, designs, manages and controls the execution of projects. She also supervises construction sites. She obtained her Master’s degree in Industrial and Civil Engineering from the Saint-Petersburg State University.