Dangerous room: how a new law would change about the hostel hotel market

That the bill on amendments to the Housing code (see reference) must be passed in the second and third readings before the end of the spring session, i.e. until June 25, told RBC the Chairman of the Duma Committee on housing policy and housing Galina Khovanskaya.

The first reading took place may 13, a 30-day period possible amendments, according to the website of the state Duma. While substantive comments of the deputies and the government to the bill were reported, says Khovanskaya.

A bill to ban the hostels

Under the draft law on the prohibition of hostels means a bill number 876688-6 “On amendments to article 17 the Housing code of the Russian Federation (to ban use of premises as hotels, other means of temporary accommodation, and also provide them of hotel services)”. The project trained a group of 37 MPs led by Chairman of the Committee Galina Khovanskaya.

The bill was registered in early September 2015, but in early October, approved by the special Committee on housing policy and housing and communal services. In the first reading adopted on 13 may 2016.

From the explanatory note to the bill implies that although the landlord “shall have the discretion to make in respect of property belonging to him any actions”, these actions should take into account “the rights and legitimate interests of neighbors.

According to article 17.1 of the Housing code and article 288.2 of the Civil code of the functional purpose of premises is the accommodation of the citizens. And the activities on the provision of hotel services may be made only after transfer to non-residential premises and the relevant equipment: for example, soundproofing, means of fire security, burglar alarms, safes for the storage of money and valuables, cleaning and sanitary cleaning of rooms.

The housing code does not exclude the possibility of translation– contained apartment in an apartment building in the residential premises under the condition that this apartment is located on the first floor. Finding above the first floor is possible, but only in the case when the spaces below are not residential.

Those who fall under the act?

According to the explanatory Memorandum to the bill we are talking about all instances of use of residential premises as a means of temporary accommodation,” including “the so-called hostels, mini-hotels”. When the dwelling is rented out, “of course, leads to the violation of housing rights of residents of other homes, living in hostels adjacent to residential areas,” write the MPs.

Under the “temporary accommodation” means a rental period of up to 180 days, said the lawyer, Board member of the “League of hostels” Natalia Petrovskaya. Longer rental belongs to the category of permanent residence and under the law misses, she says.

The concept of “hostel” and “hotel” at the legislative level is not defined, most often know them apartment, for daily rent, says senior lawyer of the law office of Maria Ponamoreva A2. In the understanding of the hotel market hostel is a small object, where in one room live a few people that are not familiar with each other, usually with a bathroom for several rooms, adds the Board member of the “League of hostels” Evgeny Nasonov.

Now in order for the landlord to open the hostel, are required to register as an individual entrepreneur and to notify about the beginning of the activity the CPS, said Nasonov. To obtain a license to open a hostel is not necessary, adds Peter.

A special license is required, but you must meet all sanitary, fire and building codes, emphasizes the head of Department of strategic consulting and evaluation at CBRE Stanislav Ivashkevich. We are talking about compliance with the GOST R 55322-2012 “Services accommodation facilities. General requirements for hostels”, was put into effect January 1, 2015 (approved by order of Federal Agency for technical regulation, Rosstandart ?1393-St of October 23, 2014).

In the Memorandum to the bill Khovanskaya clarifies that this standard allows you to organize hostel in a residential area, and that this loophole MPs want to close.

In the end, the activities of people and companies who rent out apartments, will be banned, confirms the Director of the company “Kvart hotel” Andrey Sharapov. According to him, “Kvart hotel” rents for rent 65 apartments in Moscow, in this issue of the renters linens and cleans the apartment. “Now any service by placing citizens in residential buildings will be prohibited,” he stresses. So we are to stop working.

Will the hostels to continue working?

In the explanatory note to the bill States that the activities on the provision of hotel services may be made only after the transfer of residential premises in the residential status.

The housing code allows you to transfer the apartment to the category of non-residential premises, even in an apartment building, but either she needs to be on the ground floor of the building or all the rooms under it must also be non-residential, specify the authors of the amendments.

Partner of the Collegium of advocates “Yukov and partners” Marina Krasnobaeva told RBC that the transfer of premises from residential to non technically complex and expensive process. “First, this requires the consent of all owners of apartments in the house. Secondly, non-residential premises requires a separate entrance,” claimed she. The process of translation is, according to her, at least 3-4 months.

The cost of construction of a separate entrance, if it is possible in principle, can reach 1 million rubles., said Nasonov: “For our business it is very big money, hardly anyone will to invest”.

“The owners of the hostels operate outside the law,” insists Khovanskaya. They pay taxes for housing, and this is several times less than for commercial real estate.” According to the CEO of the company-appraiser Valrus Pavel Kartsev, the tax rate for residential properties with cadastral value up to 10 million rubles in Moscow, for example, in 2016 is 0.1%, for non-residential is 1.3%. Thus, a flat tax cadastral value of, for example 9 million rubles will amount to 9 thousand rubles., on the personal estate of the same value 117 thousand.

Renting apartments and houses to rent in most cases is carried out without notifying the tax service, or CPS, that is, is illegal, and, therefore, with the introduction of the new law in force for many landlords, nothing will change, warns Ponamoreva.

What will change for the tourist market?

According to the President of the Moscow representative office of the Association “Interregional Association of the development industry hostels” Sabirianova Novel, only in Russia there are at least 1 thousand of hostels, most of which are located in apartment buildings. According to the Ministry of culture, the entry of the new law will lead to the closure of more than 45 thousand companies across the country.

According to Rosstat, housing stock of Russia the beginning of 2015 consisted of 62.9 million apartments. According to the head rent real estate Agency “ABC of housing” Novel Babichev, judging by Moscow, we rent approximately 8-10% of all apartments, including rent at 1-2%, according to Babichev. That is, in the whole country in daily rentals can be zadejstvovany more than 600 thousand apartments.

The hotels themselves are much less, besides, most part of the room stock is outdated: according to Cushman&Wakefield, in Russia only 10% of the total room stock of hotels, or 70.2 thousand rooms, can be attributed to quality offer.

“This situation has a particularly negative impact on the leisure industry in Saint-Petersburg, Moscow, the Crimea, Sochi, Yekaterinburg, Kazan, Nizhny Novgorod, Novosibirsk, is spoken in the official reply of the press service of the Ministry of culture at the request of RBC. This will lead to social tensions on the black sea coast of Russia, the Crimean Peninsula, as the use of premises as accommodation facilities for temporary accommodation is the main source of income of the population in the resort areas”. Rising prices for hotel services in this case, generally unpredictable, says a representative of the Ministry.

Moscow hostels

About 300 hostels have been in Moscow in 2015

30-40 seats is the average capacity of the Moscow hostel

Less than 10% Moscow hostels are located in separate buildings or uninhabited houses. In homes located more than 75% of hostels of Moscow

5-7% of the hostels has a capacity of 100 seats. The biggest Moscow’s hostel can accommodate 300 people

About 15 networks of hostels operated in Moscow in 2015

60-65% reaches the average load of hostels in Moscow (download in high season 85-90% in the low 50-55%)

More than 50% of demand for accommodation provide foreign nationals

600-700 RUB is equal to the average cost of placing a one-bed in hostels of Moscow

45 thousand Russian hotel companies in Russia will be closed after the law took effect. In different regions they account for from 20 to 40% of the market capacity of accommodation

Source: JLL, Ministry of culture

“If the law is passed, there will be a shortage of hotel rooms sure Sabirjanov. It is going to affect prices within the Garden ring in Moscow, it is now possible to stay in the hostel for 600-700 rubles. per day in quadruple or sextuple room. While two-star hotels within the Garden ring, there is only a three-star, the prices of which start from 4 thousand rubles. per room.

“A room in cheap hotel in Moscow can cost 3-4 thousand rubles a day, told RBC managing Director of the company “Adora hostel” Sergei Suvorov. A place in the hostel even in the center of the city can be obtained, for example, for 750 rubles. the Difference is obvious”. “We can rent an apartment near the metro station “Mayakovskaya” is about 4,3 thousand rubles a day, tells Sharapov from “Kvart hotel”. And located next to the Beijing hotel room will cost you 10.4 thousand rubles.”.

Will the amendments on the work of Airbnb and other intermediaries?

Internet services, aggregating the proposals for the surrender of apartments and houses, for example, the application of the American company Airbnb, the law will not fall, says Ponamoreva. “Forbidden will be the services of a hotel and Airbnb and similar sites, in fact the advertising platform I agree Sharapov. They do not enter into contracts for the lease and are not responsible for the activities of tenants and landlords”.

The General Director of Airbnb in the CIS (base in Russia consists of 28.8 thousand of ads on apartment rent), Andrey Verbitsky refused to comment on the bill.

The founder of the company “Daily.<url>” (base 60 thousand rent apartments all over Russia), Yury Kuznetsov said that the work site will not be banned, but does not exclude that the Supervisory authorities can order the company to remove the ads, the information about which they seem illegal. “In any case, the number of ads will decrease drastically, and perhaps our activities will cease to be profitable, and we have to close,” he upset.

“Daily.<url>” charge for placing ads with landlords, says Kuznetsov. The cost of one ad per day varies from 10 rubles to 1 thousand rubles. (low price just for placing ads, the most high because the message is in the first place). The amount of revenue and profit Kuznetsov did not disclose.

Airbnb charges 3% Commission from the owners of housing for rent apartments for rent, the Commission per person is calculated depending on the duration of his stay and the total cost of the reservation, passed through the representative Verbitsky.

Who opposed the adoption of such a law?

The main opponent of the new law the Ministry of culture: Minister Vladimir Medinsky has called the ban of hostels in residential buildings the impact on domestic tourism. “Together we need to make sure that this legislation is defended on the output and tenants, and business. Otherwise in the same form as now, it could be a blow to the gut of domestic tourists, especially the disadvantaged”, Medinsky said (quoted by “Interfax”).

Not welcomed the law and economic development, said RBC representative of the press service of the Ministry: “the above amendments to the Housing code would entail a reduction in the number of economic entities, carrying out activity on granting of services of temporary residence, but will also lead to the growth of the informal sector in the provision of hotel services”.

Wednesday, June 8, representatives of tourist industry will hold a picket in Moscow, said Nasonov. “A new initiative in the state Duma passed the first reading on populist slogans, with virtually no analysis, and without the participation of the community. Now the state Duma will only deepen the crisis in the tourist market and deprives people of the last source of existence,” is given in the press release, the words Sabirianova.