Sunday, August 7, 2011

Shady Oleg Shvyryov: Moscow bargain building faces dump, demolition after tenants live without water, sewage, power

Real estate prices were skyrocketing in the mid-2000s, and Vladislav Vorontsov was delighted at the opportunity to buy an apartment at half the market price in a building under construction just outside Moscow.

But the two-bedroom apartment he showed a Moscow Times reporter in July had no gas, water, electricity or heating, and faced a trash dump.

Even that sorry residence may soon be lost because the building, in the town of Novoivanovskoye, west of the city, is slated for demolition as illegal. That, however, would not void Vorontsov's bank-issued mortgage of 1.5 million rubles ($55,000), which he is still four years away from paying off.

His plight is not unusual. Russian housing is notoriously expensive. Middle-class buyers are desperate for bargains, and purchasing apartments before they are built is the most common way to receive one.

But the practice is risky, and the army of cheated homebuyers — "obmanutiye dolshchiki" — numbered more than 109,000 nationwide, State Duma deputy and United Russia member Alexander Khinshtein said in March, his web site Postroim.com reported. In 2006, the figure was estimated at 200,000.

The businessman behind the project, Oleg Shvyryov, said he only wanted to help people, but his good intentions were blocked by local authorities. His clients insist that he was aware the construction was illegal and simply wanted to pocket their hard-earned cash. (more)