Experts criticized the state’s housing policy: the substitution of concepts

In 2023, housing has ceased to be available in all regions of Russia without exception. And for the residents of Moscow, St. Petersburg and Kazan, it is just right to forget about improving housing conditions for several years. These are not emotional statements, but the data that experts voiced at the representative All-Russian Conference “Mortgage Lending in Russia”.

In 17 Russian agglomerations with million-plus cities, from 2010 to 2021, the share of housing commissioning was constantly growing and in the first quarter of 2022 amounted to more than 60% across the country. It would seem that there is competition between developers, buyers have a wide choice. But are apartments available in these regions? Against logic and common sense, no.

“In the first quarter of 2022, we entered a new phase, when the purchase of apartments was no longer available to citizens,” says Nadezhda Kosareva, president of the Institute of Urban Economics.

The indicator of housing affordability, which is used in Russia, is the ratio of the cost of an apartment to the annual income of an average family. In simple terms, this is how many years it takes to save up for an apartment, postponing total income. You can’t spend this money on food, clothes, utilities, entertainment – in general, nothing. The lower the ratio, the more affordable housing.

In the Yekaterinburg agglomeration (Yekaterinburg and the Sverdlovsk region), this coefficient is the best in the country – 3.3 years. But even this level is qualified by experts as “Housing is not very affordable.” With the same wording, but with a worse coefficient (from 3.8 to 4.3), six more agglomerations were identified: Samara-Togliatti, Chelyabinsk, Voronezh, Nizhny Novgorod, Rostov and Perm.

In other regions, the situation is even worse. Their affordability ratio is higher than 5: “Acquisition of housing is seriously complicated.”

And, finally, three anti-rating winners: Kazan (6.3), Moscow (6.3) and St. Petersburg (6.5) agglomerations. In these areas, apartments are “substantially unavailable”.

– According to the international classification, the purchase of housing is available only if the coefficient is below three. Back in 2018, there were 14 such agglomerations, in 2019 – 12, in 2020 – 10, in 2021 – 9, – Nadezhda Kosareva gives examples.

– There was a substitution of the concept of “affordable housing” with the concept of “affordable mortgage”, – says the head of the analytical center “Indicators of the Real Estate Market” Oleg Repchenko. – For some reason, everyone decided that it is necessary to make the mortgage cheaper – and this, they say, will become a panacea. But what did we see? The lower the mortgage rate, the higher the price of the apartment. The monthly payment for buyers remains about the same. And the budget money flows into superprofits for developers.

The analyst suggests comparing reports from developers that are traded on the stock exchange for 2020 and 2021: “Their profits have doubled due to preferential mortgages. Moreover, the market is stepping on the same rake as in the early 2000s. At first there was no mortgage, then it appeared – and immediately housing prices rose. But then at least the income of the population increased. And the increase in the cost of apartments during the coronavirus period is generally some kind of surrealism.

Oleg Repchenko compares a preferential mortgage with an antibiotic that must be used in the acute phase of the disease, but for a very short time and without abuse. In Russia, preferential mortgages were introduced when there was an acute phase of the crisis, but they forgot to cancel them in time. The patient has turned into a drug addict who is used to pills and can no longer live without support.

– Our construction market will go through an acute phase more than once, but how to save it if the antibiotic has already become addictive? Repchenko continues. – It would be correct, for example, to introduce preferential mortgages when the key rate of the Central Bank rises above the critical level, say, 12%. And when the key rate is reduced, you need to automatically “turn off” it.

As a result, for the first time in history, housing at the stage of excavation, due to overpricing “thanks” to preferential subsidies, began to cost 30-40% more than finished real estate. This is not about “Khrushchev”, but about modern housing in the same new buildings 5-10 years ago. At the same time, finished housing is no worse in quality, and often better than the one under construction. And here’s why, the analyst explains.

The studio apartments flooding the market are smaller than standard hotel rooms. How can families with children live in such places? The area of ​​housing in business-class new buildings is less than in ordinary Soviet houses. And this inadequate number of storeys? It is not for nothing that houses of 35-40 floors with a huge density of inhabitants and low ceilings were dubbed by the people as cheloveniks. It got to the point that developers present new buildings with a height of 12-16 floors as low-rise business-class housing.

— There is a global criterion for housing affordability. The price per square meter should be comparable to the average monthly income in the agglomeration. In Russia, the cost of a “square” has always been at least doubled. And now in 16-storey “business” buildings – once every five, – says Oleg Repchenko.

The housing situation in Russia is sad, sums up Nadezhda Kosareva. Half the families of three and one in three families of four to six occupy only one or two rooms. On the other hand, 70% of single people live in apartments with two or more rooms. Such is the inverted distribution of the housing stock.

The scientist emphasizes that in order to correct the situation, it is necessary, in particular, to significantly reduce the cost of housing construction and look for options for low-income people. Obviously, the preferential mortgage, which will continue to operate for more than a year, does not apply to these options. “A mortgage, even with a zero interest rate, will not help most Russians solve their housing problems,” concludes Nadezhda Kosareva.