Despite its huge oil wealth, Russia is facing the effects of the global economic downturn. Unemployment has gone up by 20 per cent in the last four months. But some are hoping to benefit from falling house prices.

In Moscow, the official number of people without work and claiming benefit is just 3,000, – up from 2,400 in October. That’s a staggeringly low figure for Europe’s biggest city.

Of course the unofficial figure is much higher, and is expected to grow massively in 2009.

To combat the growing problem of unemployment, the government is allocating more than a billion dollars for regional job creation programmes.

Aleksey Pavlov is out of work. He hopes a government-funded job initiative will help.

“Since December I have been looking for work and I can honestly say it’s getting more and more difficult to find it,” Aleksey said.

Aleksey’s case is not unique. More and more people in Russia are expected to turn to the government to pull them out of a hole.

For some the recession comes with a silver lining.

The Frolov family wear big smiles. But the limited amount of space in their one-bedroom apartment in Moscow constricts their style. The flat doubles as a playground, a gymnasium and everything else.

They urgently need more room. But finding a new apartment in Moscow is not for the faint of heart.

That said, the financial crisis has driven property prices down. So now could be the time to buy a bigger place.

“We are lucky because the crisis is working in our favour. Real estate prices are falling and quickly – for years it was the other way round,” Maria Frolova says.

With Russia’s sky-high mortgage rates, the Frolovs knew borrowing from a bank wasn’t an option. But through a combination of savings, a programme called maternity capital, and selling what they have, the family’s dream of more space could come a reality.

“Maternity capital is a one-time sum given to mothers who have two or more children. And we can use that to help buy a new apartment,” Maria Frolova says.