Posted by Jonathan J. Miller -Monday, April 10, 2006, 12:01 AM
Here’s an interesting dynamic relating to housing controls in some oil producing countries.
On one hand, Russia, a country struggling with free market forces, is trying to reduce subsidies toward housing by shifting more of the burden to its citizens and supplementing some of the costs from the surplus income generated by oil revenues. Some of its citizens are protesting the changes [Moscow Times].
Tens of thousands of demonstrators rallied across the country on Saturday to protest hikes in rent, utilities and housing maintenance fees, which have been rising because of the Cabinet’s efforts to reduce subsidies.
On the other hand, Venezuela, a country seemingly moving toward a more authoritarian state, has decreed that housing price increases will be set by the government [Bloomberg]. Housing prices appreciated 35% last year because of the lack of new housing, and presumeably demand increased because of economic gains from additional oil revenues.
Venezuelan President Hugo Chavez said he may set prices for private housing and expropriate apartments and houses from owners who refuse to sell at regulated prices.
Like the US, it seems that many other countries are also dealing with the economic impact related to housing [Weekly Standard].