Russia is seeing a further slowdown in the growth rate of prices for new buildings. In August, prices for housing under construction increased by only 0.1%, which is the lowest figure since March of this year. This indicates a gradual transition of the market from active growth to stabilization. In Moscow, the situation is even more pronounced - prices fell for the second month in a row, reaching 1.22% in August.
The decrease in demand after the end of the preferential mortgage was the key factor influencing the slowdown in price growth. Sales of new buildings in July-August fell by 43% year-on-year. As a result, the price decline affected various market segments, while in August it became more noticeable in the economy and comfort classes.
Despite the slowdown, prices for new buildings in Russia as a whole have grown by 6% since the beginning of the year. However, taking into account inflation, the real growth was only 0.7%. More stable demand for business and elite class housing led to a more significant price increase (+6.6%) compared to economy and comfort class housing (+5.9%).
In general, the situation on the new buildings market is characterized by a decrease in the rate of price growth and a reduction in demand. This is due to the end of government support programs, which is reflected in price dynamics in various regions of the country. The most noticeable price decrease was observed in the Ulyanovsk, Ivanovo and Tver regions, while Moscow took sixth place in the ranking of regions with falling prices.
According to estimates by the Central Bank of Russia, prices on the primary real estate market have already begun to decline in one third of the country's regions, despite the fact that they had previously demonstrated accelerated growth. According to Elvira Nabiullina, head of the Central Bank, this was one of the consequences of the long-term preferential mortgage program, which stimulated demand and pushed prices up. However, with the end of the main preferential lending program, an immediate drop in prices should not be expected. Nabiullina emphasized that the price adjustment process will be gradual, and the real estate market will smoothly adapt to the new conditions. Thus, the Central Bank predicts that the reduction in prices on the primary real estate market will not occur abruptly, but gradually, which will avoid sharp fluctuations and negative consequences for the market.
