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Mortgage market collapse predicted in Russia
It's all about rising interest rates and rising housing costs.
The volume of mortgage loans issued in Russia is expected to drop significantly to 45-50% by October 2023. This forecast was made by Ildar Khusainov, a real estate agent at Etazhi and a leading expert in the real estate sector. Despite this decline, he noted that market revenue still grew by 32.6% compared to October 2022, but decreased by 19.4% compared to the previous month of this year.
According to Khusainov, the current situation on the real estate market requires careful analysis. He emphasized that 2023 was characterized by significant government subsidies, which makes the financial results somewhat artificial. "The real estate market is functioning normally, but it is important to understand that it does not paint a realistic picture," the expert said in an interview with 72.ru.
Referring to the current limit of the family mortgage program at 350 billion rubles, Khusainov noted that these funds will only last for November and part of December. If you are planning to purchase housing with a mortgage loan, we strongly recommend that you do not put off solving this problem for later.
Experts also expressed concern about the conditions for future developers, given that construction companies will face great difficulties, as mortgage interest rates reach 21%. "Almost all of the developer's profits will be directed to paying off bank debts," Khusainov warned.
Due to these changes, prices in the real estate market are also falling. For some properties in October 2023, this decline was between 1% and 1.2%, which is much higher than the typical 0.5%. At the same time, the share of transactions made in cash is increasing.