By the end of 2024, the growth rate of the construction industry is expected to slow down

By the end of 2024, the growth rate of the construction industry is expected to slow down

Last year, the construction industry managed to increase the volume of work by almost 8%, to 15.1 trillion rubles. However, by the end of 2024 the dynamics may slow down. The reason for this is, first of all, the uncertainty with the extension of preferential mortgages, on which the housing segment depends, as well as the high cost of borrowed funds for the implementation of infrastructure projects.

In 2023, the volume of construction work in Russia increased in comparable prices (taking into account inflation) by 7.9% year-on-year, to 15.1 trillion rubles, the Sherpa Group calculated. This is a significant increase in recent times. For comparison: at the end of 2022, the figure increased by 7.5%, to 13.1 trillion rubles.

The acceleration in the growth rate of the volume of construction work is associated with an increase in housing construction, an increase in investments in the national project “Safe Quality Roads” and the creation of new facilities in industry, explains Sherpa Group CEO Alexandra Galaktionova.

Thus, according to Rosstat, in 2023 the volume of housing commissioned throughout Russia was a record - 110.44 million square meters. m. Last year, 650 km of highways were built and updated throughout the country - this is almost three times more than in 2022, notes First Deputy General Director of the Natproektstroy Group of Companies Ruben Aganbegyan.

Activity in the construction industry could have been higher, Ms. Galaktionova believes. But, in her opinion, this was prevented by the “gradual winding down of investments through a comprehensive plan for the modernization and expansion of the main infrastructure,” which received half as much money as in 2022, as well as the completion of large-scale infrastructure projects, such as the M-12 Moscow-Kazan highway and the Big Circle lines of the Moscow metro, the expert adds.

In 2024, the situation in the industry may be difficult.

As Alexandra Galaktionova notes, on the one hand, the authorities do not yet plan to reduce costs in the road sector, but on the other, investments in a comprehensive plan for highway infrastructure will again be cut by almost half. Thus, according to her calculations based on the Ministry of Finance data, the authorities will invest 18% more in the national project “Safe Quality Roads” in 2024 than the actual expenditures in 2023 - 621.4 billion rubles. and for the comprehensive plan, on the contrary, expenses will be reduced by 44%, to 120.4 billion rubles.

In addition, Ms. Galaktionova expects, private investors may suspend the launch of projects in anticipation of new May decrees of the President of the Russian Federation, which could lead to a reorganization of national projects. In addition, with the current Central Bank key rate of 16%, the cost of loans, according to the CEO of the National Association of Infrastructure Companies, Maria Yarmalchuk, “is practically a prohibitive measure for the implementation of large-scale infrastructure projects.”

In housing construction, the issue of extending preferential mortgages after July 2024 remains unresolved, continues Alexandra Galaktionova.

The head of the Dom.RF analytical center, Mikhail Goldberg, believes that in 2024 there may be some slowdown in demand in the housing market, but at the same time it will be supported by the extension of the family mortgage program. General Director of RKS Development Stanislav Sagiryan, however, expects that the volume of housing construction in Moscow in 2024 will be about 5 million square meters. m. For comparison: in 2023, according to Rosstat, the figure was over 7.3 million sq. m. m.

The shortage of workers will complicate the work of developers, something that developers are already facing, Mr. Sagiryan expects. This will lead to an increase in project implementation time, which, in turn, means extra costs, he continues. In addition, now the estimated cost of remuneration for construction workers is underestimated by more than 25%, adds Maria Yarmalchuk. Currency fluctuations and rising costs of materials will continue to have an impact on the industry, says Frunze Aleksanyan, chief economist of the construction project management department at Nikoliers.

Member of the General Council of Business Russia Oleg Malakhov expects that the volume of construction work will only increase, since “today’s realities leave no chance for the industry to stagnate, as this will lead to the bankruptcy of many companies.” But, according to him, the construction and related industries cannot be promoted on enthusiasm alone, and a competent combination of government orders and private investments in industrial production is important.

Daria Andrianova, Vladimir Komarov

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