Today we will talk about the prospects for the residential real estate market. When and why will housing prices fall? What is the logic in future processes in the real estate market?

Real estate demand is already reduced in most regions of Russia. Such a conclusion was made of communication with realtors who know the market of Moscow and the Moscow region well (some of them are also aware of the general situation in the country).

Now there are several reasons for stagnation of demand for apartments: from the ongoing decrease in the actually disposed incomes of the population to a sharp growth of the key rate of the Central Bank of the Russian Federation.

Reducing the mortgage rate

The key rate was gradually reduced, respectively, and the mortgage percentage becomes more lifting for most potential buyers (but still remains high). We are talking about ordinary mortgages (not preferential), that is, to the secondary.

A preferential mortgage (the rate is already below 10%) will pull a larger number of potential buyers. But there remain the problems of reducing the real income and the high price of real estate.

During the previous years, the residential real estate market has grown very much on the positively adequate mortgages and excitement (inflated media).

It is no secret that the main engine of prices for square meters. Meters are the availability of mortgages, the adequacy of interest rates on mortgage loans, and not the cost of building materials.

It is the mortgage (especially recently) supports the real estate market. And now various lobbyists are trying, for example, to spread a preferential mortgage and secondary housing.

This will be a powerful factor in real estate market support, especially if the interest rate is decently reduced.

In the meantime, discounts on the secondary appear, but more often they appear only during the bar processes.

The new buildings segment also have hidden discounts and partial mortgage subsidies, that is, part of the mortgage payments is taken by the seller of new buildings - this is already a common practice.

This scheme reduces the mortgage burden for the buyer (load on payments, and not the total cost of purchasing an apartment).

It must be understood that all this is not from the bounty, everything is originally inherent in the price (and this should be realized before buying and it is advisable to calculate).

Reduction in income of the population

Quite key in determining the future dynamics of the real estate market will remain a population growth factor. And income is all reduced. Now people have very little money, they have already given it to the pandemic period for the previous mortgage.

And those who want to take a preferential mortgage can become significantly less. And some simply will not want to take, because they can count and their confidence in their income has decreased.

Entering new housing

The dynamics of housing input is confidently preserved (although there is some decrease in the pace compared to the beginning of the year).

For example, in March +35 g/g, in April +82% g/g, and in the 1st quarter of 2022-more than 60% g/g. - This is a good dynamics, which, most likely, will not remain in the near future.

Understanding all of the above, it would be logical to assume that housing prices will decline, there are many prerequisites for this. Subject experts are waiting for a decrease from 5% to 20%.

However, the following important factors may be prevented by reducing prices:

In addition, an increase in the number of rubles in the financial system can increase real estate prices. Various subsidies, indexations will also help the real estate market to resist.

All these processes are quite able to support the decreasing prices for squares.

findings

Thus, I am still prone to reduce apartments, but I do not predict a strong drop in prices. It becomes obvious that the industry will clearly be supported.

The basic forecast is a 5-15% decrease in apartments for the beginning and in the autumn of 2022.

But the authorities can bring high uncertainty to the behavior of the market with their possible additional programs for stimulating the housing market.

Also, if rubles are actively printed on various (including social needs), then real estate prices may slightly decrease.

For today, thanks for your attention!

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