Interesting, very interesting. Yesterday, a meeting chaired by Deputy Prime Minister Igor Shuvalov was attended by Economic Development Minister Elvira Nabiullina... ... as well as representatives of Inteko, Glavstroy, SU-155, PIK Group, Renovastroygroup, and Barkli. Alexander Machevsky, a representative of the deputy prime minister’s office, said that specific measures of state support for the construction industry were discussed, and some of them were approved. ... A state guarantee will take the form of the authorities buying economy-class housing built by developers. “Apartments will be purchased at a fixed price based on the construction cost of 1 square meter in a given region, plus a 15 percent markup,” a source told Kommersant. This information was confirmed by Martin Shakkum, head of the State Duma committee on construction and land relations, who took part in the meeting. http://www.kommersant.ru/doc.aspx?DocsID=1041464 What could this mean in the case of Moscow? SU-155 representative Elena Pivovarova insisted that construction costs now stand at 30,000–45,000 rubles per square meter, and cannot be any lower. So: Let’s take the upper end — 45,000 rubles per square meter. About $1,800. Markup: 15%. That means that if the government is able to buy newly built apartments from Moscow developers at all, it will be at a price no higher than $2,070 per square meter. And yet the average price per square meter in Moscow was still being quoted just two months ago as $6,300. It’s a good scheme, but... uhhh... there are a few questions. BEFORE the crisis, the Russian government for some reason did not hold emergency meetings on the subject of: “Oh my God! Muscovites can’t afford to buy housing at such insane prices! Let’s do something to rein in crook Luzhkov (Yury Luzhkov, then mayor of Moscow) with his crooked construction monopoly and get prices down to around $2,070.” On the contrary, everyone seemed quite happy with the progress of the national “Affordable Housing” project, and in particular with the successes of Moscow’s construction sector. But now the Russian government has decided to support Inteko by buying its housing at a 15 percent profit margin. And of course, this housing is being bought with taxpayers’ money. In other words, with our money. Now they consider $2,070 per square meter an acceptable price for both sellers and buyers. Two months ago, they were not bothered by a price of $6,300. So the government is effectively admitting that even two months ago builders could have been selling at $2,300 and still earning an excellent margin. But then the crisis arrived, and now we will pay to make sure Inteko and the others get through the hard times with an acceptable profit margin (15%), and then, when the crisis is over, Inteko will once again offer us apartments at $8,000 per square meter and operate at a 400% margin. How lovely. I absolutely do not agree that Inteko should be supported from the state budget. That is, at my expense. If anything, I think the management of Inteko ought to be sitting in the dock. Along with those who provided Inteko with such wonderful operating conditions. I would like these state support measures for our marvellous builders to be accompanied by investigations into monopoly collusion, corruption, and abuse of office.