An expert predicted a decline in prices on the real estate market in Russia
The primary residential real estate market is waiting for cooling and price reduction, Oleg Repchenko, head of the Analytical Center "Real Estate Market Indicators IRN.RU" told "Izvestia".
"What is happening in the primary housing market: there is no more preferential mortgage, clouds are gathering over the "family" (the limits for this year are almost used up, and it is not known whether new ones will be allocated), the rates on market loans have long exceeded 20%, prices are high, demand has sharply decreased. In such a situation, our forecast is that the market will cool down and prices will fall. Not immediately. For now, developers, who increased sales during the frenzy of last year and this year (in anticipation of the shutdown of favorable mortgages), can live on low demand. Escrows, on the volume of funds on which the project finance rate depends, are full," he said.
At the same time, as the current projects are completed, developers will have to attract the attention of buyers to new projects in order to quickly fill escrows, if they do not want to pay for project financing at 20% and more, the expert said. As a result, they will need to find new ways to incentivize sales.
"To subsidize mortgage rates at base rates above 20% becomes expensive, plus it significantly increases the cost of apartments for the buyer, so it is likely to grow the size of discounts and the number of offers with a discount, which will be timed, most likely, to the New Year. A more noticeable trend to lower prices will become next year, as the current projects are completed and new ones enter the market, as well as under the influence of the CBR (Central Bank of the Russian Federation. - Ed.) Mortgage Standard, which should prohibit mortgage schemes - with their help developers are now stimulating demand", - explained Repchenko.
Earlier in the day it was reported that the decline in real estate prices can damage the welfare of the banking sector. This follows from the report of the Accounts Chamber on the results of the audit on preferential mortgages. In such a case, the value of property that is pledged to the bank on housing loans will also fall, which will force financial institutions to allocate more funds to form reserves for loans, the document specifies.
