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Economist predicts mortgage crisis in Russia
In Russia, a mortgage crisis may arise due to record high rates on mortgage loans on the market. This future of the market was predicted on the air of the radio station "Moscow Speaks" by the former Deputy Minister of Economic Development, Doctor of Economic Sciences Alexey Vedev.
The expert explained that Russians find it difficult to pay off loans over 23%. This is because these loans result in “huge payments”. “I think we are planting a bomb when mortgage rates are 23%. In my opinion, the optimal or maximum mortgage rate is 6%. Over 30 years, you have purchased two apartments. One for you and one for the bank. A mortgage at 23% is the purchase of three or four apartments and the purchase of one apartment yourself,” Vedev calculated. He added that some people think that raising their salaries will allow them to pay off mortgages at such high rates, but it is unclear what will happen to their income in the future.
Earlier in the day, analysts from the rating agency ACRA concluded that the Russian housing market could face a mortgage bubble, despite the high quality of the mortgage portfolio.