What awaits the Russian residential real estate market.
Context: The main anomaly of the Russian real estate market has become the huge price gap between new buildings and secondary housing. According to the Expert RA agency report, this ratio reached a coefficient of 1.55–1.65. An apartment in the excavation phase costs 1.5 times more than the finished housing.
Reasons: entrepreneurs do not sell concrete, but a financial plan. Developer costs for subsidizing rates, marketing and various payment plans are artificially built into the base price of primary housing. The buyer of a preferred mortgage is actually overpaying for the very opportunity to take out a cheap loan.
The position of the developers: entrepreneurs tend to complain that the real estate market has become a victim of the tough monetary policy (MCP) of the Central Bank of Russia.
The effect of preferential mortgages: the rate differential subsidy on issued loans is already costing the treasury about 2 trillion rubles. every year To cover this deficit, the Ministry of Finance had to borrow money in the market through OFZ at 16–17% per year. For investors to buy these securities, the yield must be high, which in turn cements high rates in the economy.
What's wrong with the product: during the previous years, developers massively built us not housing for families, but invested in one-room apartments and micro studios. Some of the multi-room apartments collapsed. A huge pool of illiquid housing has been created in the market.
Prospects: Experts predict large-scale nationalization of construction. Bankrupt companies will be transferred for restructuring to large government banks or development institutions such as DOM. RF. The authorities will be forced to look for ways to stimulate the flow of capital from economically scarce investment apartments to the real sector. A logical step for the fiscal authorities could be to introduce a progressive tax on the total cadastral value of all real estate owned by a citizen.