Housing and Communal Services: Lost in Price but Outstripped Portugal. FBK Study of “How Much is Russia”

The evaluation of the system of housing and communal services under the next stage of the study of “How much is Russia: 10 years later” allowed exposing a number of positive changes in the sector over the last decade.

So, owing to the increased provision of housing with central heating (from 75% in 2003 to 84% in 2012) Russia in terms of this indicator is ahead of many European countries (Greece, Latvia, Lithuania, Poland, Portugal, Slovenia, France, the Check Republic, Estonia). It is only fair to note that in some countries this indicator has reduced (Bulgaria, Estonia, Armenia, Kirgizia, Tajikistan). It turned out that central heating is not by far such a benefit in terms of energy saving.

The indicator of per capita housing area in Russia increased from 19.8 sq. m. in 2002 up to 23.4 sq. m. in 2012, the growth is 18.2%.

However, against the background of growth of housing and the benefits of civilization in the recent years the condition of the housing fixed assets paradoxically has not improved, points out the head of the study Igor Nikolayev, the FBK Institute of Strategic Analysis director

Today the housing and communal basic assets are physically depreciated by about 60-70%, about as much as 10 years ago when the estimations varied in the range of 60-80%. The share of communal networks that need replacement badly has increased for the recent decade. If in 2004 19.3% of heating systems were in bad need of replacement, in 2012 the share of such networks increased up to 29.3%. And paradoxically, the number of breakdowns for the said types of networks reduced, though their length remained nearly the same. The number of accidents with the water supply system diminished by 30%, and the accidents with the heating mains – by 3.7 times.

Igor Nikolayev points out that the housing and communal services sector differs from the other sectors as characterized with most insufficient and inconsistent data. For example, at present Russia does not publish the figures of the employment in the housing sector. According to the Minregion of Russia, as of the summer of 2013, the number of the employed in the housing sector varied within the range of 2 – 5 million people.

The housing sector estimated cost dropped by 1.9 times over 10 years and amounted to 61.5 bn rubles. The key factor to predetermine such a result is the decrease of predictive estimates.

You can see the details of the study at skolko.ru.