The introduction of preferential mortgage programs distorts prices in the market for new buildings, which is why demand is falling. Candidate of Economic Sciences, Associate Professor of the Russian University of Economics named after V.I. G.V. Plekhanov Dmitry Osyanin.
– In general, in the construction industry, we observe that any subsidy program distorts prices in the new building market, since there are practically no market mortgages left in the primary market. It is beneficial for buyers to give up the privileges of the developer and take a mortgage loan at a favorable rate, that is, a benefit, the expert said.
The economist stressed that in the future, sales in the new-build market will recover after the abolition of preferential mortgages, which are valid until July 1, 2024. After that, prices for market mortgages will recover, since today there is an imbalance in prices between market and preferential prices in the new building market.
“We expect that market mortgage rates will remain at the level of 9.5-10.5% per annum, because due to the unfavorable situation in the world, banks include their financial and other risks in these interest rates,” Osyanin specifies.
The development of the market for new buildings before the pandemic was such that many banks themselves attracted their payroll clients on their own preferential mortgage terms, the specialist continued. For example, upon conclusion of a DDU agreement or a contract for the purchase of real estate directly through the developer, the percentage of a mortgage loan is immediately reduced by 1%, an additional 1% can also be reduced subject to the life insurance of the borrower and real estate, which is prescribed by the terms in the mortgage loan agreement. Such tools will be able to restore sales of new buildings in the future.
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