In Moscow, apartments at the excavation stage were bought up

The activity of buyer-investors in the Moscow new buildings market has led to a reduction in the supply of properties in the initial stages of construction by almost a third. These lots are often purchased for resale under assignment agreements. High demand led to a rapid increase in prices: apartments in completed comfort-class buildings turned out to be cheaper on average than in properties at the foundation pit stage. Ready-made and not always attractive lots accumulate in the exhibition.

Apartments in buildings at the stages of excavation and installation of the first floors at the end of October formed 25.2% of the exposure on the primary market of “old” Moscow versus 37.5% a year earlier, NDV Real Estate Supermarket calculated. In physical terms, the volume of supply at the initial stages of implementation decreased by almost a third over the year, although the total exposure increased by 0.2%, to 2.2 million sq. m. m. Metrium says that the volume of supply at the end of October remained at the level of last year – 66.6 thousand apartments and apartments, and the exposure at the initial stage decreased by almost 2.5 times, to 9.8 thousand lots. Managing partner of bnMAP.pro Irina Dobrokhotova noted a decrease in the share of lots at the initial stages of construction in new comfort class buildings from 34% to 23%, business class – from 29% to 16%.

Tatyana Podkidysheva, executive director of the NDV Supermarket Real Estate company, associates the washout of supply from the market at the initial stages of construction with high demand. According to Rosreestr, in October 12.1 thousand equity participation agreements (EPA) were concluded in Moscow, which is 2.6 times more than in October 2022. In September, the year-on-year figure increased by 77%, to 13.6 thousand. In August, 11.5 thousand preschool children were registered, which is 66% more than a year earlier. The high rate of absorption in the market was associated with the Central Bank’s increase in the key rate, tightening of lending policy and previous expectations.

Managing Director of Metrium Ruslan Syrtsov connects the high interest in lots on the foundation pit with the activity of investors during the rush period: “They expect to obtain a mortgage on favorable terms and then resell the apartments under assignment agreements, which are covered, in particular, by family mortgages.” Such buyers avoid ready-made new buildings. Investment purchases by clients with foreign currency savings were stimulated by the growth of the dollar, adds Svetlana Bardina, director of the residential real estate sales department of the Summa Elements Group of Companies. Another factor in the reduction in exposure could be a decrease in development activity.

Mr. Syrtsov says that in January-October, sales began in 56 residential and apartment complexes, and during the same period last year, developers brought 78 projects to the market, that is, 39.3% more.

The washout of exposure led to a rapid increase in prices. According to NDV, over the year all new buildings in “old” Moscow rose in price by 14.7%, to 436.7 thousand rubles. for 1 sq. m. And the cost of supply for the pit, according to Metrium, increased by 26.8% year-on-year – to 431 thousand rubles. for 1 sq. m. From the NDV data it follows that apartments in already completed buildings at the end of October were on average only 5.3% more expensive than new buildings at the excavation stage. A year earlier, the gap was 13.5%. In comfort-class objects, the dynamics are even more significant. If last October the average cost of 1 sq. m in finished buildings was 8.5% more than in objects at the foundation pit stage, then this year finished buildings turned out to be cheaper than new buildings in the early stages by 9.9%.

According to Metrium, developers are now selling 7.1 thousand lots in completed new buildings, 41.4% more than a year earlier. “In most projects there are unclaimed lots that take longer to sell, for example, due to poor views or proximity to elevators,” says Ruslan Syrtsov. Irina Dobrokhotova adds that in objects that have already been commissioned or are in the final stages, 18% of the business class supply is on display versus 9% a year earlier. Commercial Director of Optima Development Dmitry Golev notes that the specifics of demand depend on the segment: in premium projects, half of the clients traditionally choose completed buildings.

Alexandra Mertsalova