A Russian village prospers thanks to the pandemic

KRASNAYA POLYANA, Russia, June 1 (Reuters) - Residents of a picturesque Russian village have seen the price of their land double as people from Moscow and other cities snap up properties as a refuge from COVID-19 where they can work remotely.

Krasnaya Polyana (Red Meadow) is a beautiful village of five streets in the mountains near the Black Sea. Flanked by mountains, it has good quality tap water, fresh air and big blue skies - things that can prove elusive in Moscow.

The village has 5,000 residents, which is typical for Russia. What is atypical is that there are 20 cafes, restaurants, a pub and a bar, along with fast Wifi.

Some of the restaurants existed before the pandemic to cater for skiers who use nearby resorts built for the 2014 Winter Olympics. But the locals decided to open year-round once they got over fears that visitors from Moscow would bring COVID-19.

Demand for second homes has fuelled a housing boom.

Russian land prices are assessed in 100 square metre units, or sotki. The price of one sotka in Krasnaya Polyana has risen to 5 million roubles ($68,000) from 2 million before the pandemic, Nikolai Rogachev, a local sales agent, told Reuters.

It is likely to hit 7 million by the end of 2021, he said, due to strong demand when overseas travel options are limited.

"We call it the zombie apocalypse," another real estate agent said, referring to demand from city dwellers for any kind of property in the village and the quality of their social skills after months spent in their small urban flats.

Prices for cottages in the village vary from 40 million to 900 million roubles, according to the CIAN real estate database.

Demand comes mainly from wealthy businessmen from big cities as prices are beyond ordinary Russians.

Rents have also risen, driven by demand from people who work remotely and see Krasnaya Polyana as an escape from the city. The airport is a 40-minute drive and hiking trails start directly from the village.

"I enjoy hiking the mountain trails and being able to find pleasant company in local places in the evenings," said Kirill Ryzhonkov, a data analyst from Moscow.

A co-working space opened in October, primarily for IT and start-up specialists.

Its owners expect Krasnaya Polyana to become a Russian Silicon Valley regardless of how the pandemic develops.

"People have already noticed the advantages: the same time zone as Moscow, a 2-hour flight to Moscow, skiing in the winter, the sea in summer and cool infrastructure left behind by the Olympics," said Ilya Kreimer, manager of the co-working space.

Reporting by Polina Devitt; editing by Andrew Osborn and Giles Elgood

Our Standards: The Thomson Reuters Trust Principles.

Thomson Reuters

Senior commodities correspondent in Russia writing about metals and mining, agriculture and other commodities