# **Summary of Findings**

This paper reviews sociological data on privatization and the development of a housing market in Russia through 1996. In doing so, it also considers demand for housing and household mobility in Russia, and people's attitudes to the use of narket methods in making decisions about their housing. The data have been collected by means of surveys of the urban population over the last several years that are largely unknown outside of Russia.

Since early 1997, housing reform has increasingly moved into the center of the focus of the Government of Russia's reform efforts. Present policy calls for a reduction, in stages, of housing subsidies (for which both tenants and owners of privatized apartments are eligible) so that cost-recovery will be 100% by 2000. But household incomes are not expected to rise commensurably, and it is likely that housing's share of the household budget will grow for most Russians.

By the end of 1996, some 55% of the Russian housing stock was privately owned. Rates of privatization in Moscow indicate that the process peaked in 1993 and since then has abated considerably, essentially coming to a halt in 1996; the same pattern, with a latter start date, was manifested in smaller cities. Not surprisingly, high-quality apartments in city centers have much higher rates of privatization than lowerquality housing at a distance from the center. Other factors influencing the decision to privatize are the demographic characteristics of the occupants, the households' value orientations and level of education, and the household income.

On the whole, privatization has thus far produced a class of owners that is far from unifonn. Two disparate demographic groups emerge as most likely to have privatized their apartments, and these two groups have essentially opposite effects on the development of the Russian housing market. Pensioners, constituting by far the largest group of privatizers, are generally not inclined to move and, thus, exert a negative effect on household mobility which, in turn, retards the advancement of the housing market in Russia. The other, much smaller group consists of the relatively well-off who can be expected to become active participants in the housing market.

Survey data indicate some movement towards a more efficient allocation of the housing stock than was the case at the beginning of transition. A certain part of the mover households moved from their original apartments to apartments that were in some respect inferior in reaction to the economic forces affecting them. The housing market allows poorer households to find housing more in keeping with their ability and willingness to pay for it.

That many renters in Russia have thus far chosen _not_ to privatize their apartments is the largely the influence of the sense of "occupation rights" inherited from the Soviet Union. would make evictions. For many Russians there have been few incentives to privatize their housing. Nonetheless, data from surveys in Moscow and two smaller cities indicate that market ideas regarding housing search methods are beginning to penetrate the mentality of the Russian public.

Despite the deterioration in the financial standing of most Russian households, a small but growing number of Russians would like to get long-term loans for the purchase or construction of housing if such a possibility existed. This suggests that a properly developed mechanism of mortgage lending could make a positive difference in the Russian housing market.