Migration and Investment Activity of Residents of Russian Cities in the Housing Market of Moscow Agglomeration

Abstract

Based on the data on addresses of real estate buyers, we assess the investment activity of residents of Russian regions and cities in the primary housing market of the Moscow capital region (MCR) compared to the activity of their labor migrations to the MCR. The objects of our analysis are 149 Russian cities and 80 remaining parts of regions. This enabled us to analyze the specifics of migration and investment behavior for the first time, taking into account differentiation between cities and rural areas, between size classes of cities, and between individual large cities. This enabled us to fill in the gap in assessing the mobility of inputs, i.e., capital and labor. A sharp contrast between settlements of different sizes was revealed in the nature of their interaction with the MCR agglomeration. The intensity of labor migration to the Moscow agglomeration is decreasing rapidly and monotonically with increasing settlement size. The activity of nonresident homebuyers, depending on the population of the city of their residence, varies nonmonotonically, reaching its highest level for cities with populations of 250000-500000 people for Moscow's housing market and 100000-500000 people in Moscow oblast. Small towns and rural areas (except for the Khanty-Mansi and Yamalo-Nenets autonomous okrugs) are a source of labor for the Moscow agglomeration and show low investment activity in the capital's housing market. Million-plus cities provide a negligible inflow of labor migrants and are characterized by moderate activity in the MCR housing market, close to the national average. Compared to the premium housing and labor market of the City of Moscow, investment and migration flows to Moscow oblast are shifted to smaller settlements and lower-income regions. The attraction of Moscow oblast rapidly decreases with distance, extending to first-and second-order neighbors, while Moscow's influence is nationwide.

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