The authorities have tightened the requirements for preferential mortgages: what are the consequences

Buying an apartment under this program will now become difficult, but prices will stop rising

On December 23, new rules for the preferential mortgage program began to take effect in Russia, which is now issued at 8%. The down payment was immediately increased from 20% to 30%. At the same time, the authorities limited the maximum loan size in all regions for preferential mortgages to 6 million rubles, and previously for Moscow, the Moscow region, St. Petersburg and the Leningrad region it reached 12 million rubles. Will the measures taken cool the real estate market in Russia and what will happen next to apartment prices?

Preferential mortgages began to attract close attention from the authorities several months ago. In particular, the Bank of Russia in October pointed out a possible overheating of the real estate market due to this program and asked the government to at least tighten the requirements for it. The authorities heeded the regulator’s calls. In particular, in the fall the down payment was increased from 15% to 20%. This yielded results, which was noticed by market participants. “The cooling of the market began already in mid-autumn after the first increase in the down payment to 20%,” says Elina Khannanova, sales director of the Granel Group of Companies. — In October and November, the “Mortgage with State Support” program accounted for 20% and 23% of apartment purchases using loans. Although in September the figure was more than twice as high – 50%.” However, the Bank of Russia considered this insufficient and tightened its rhetoric. In December, Chairman of the Central Bank of the Russian Federation Elvira Nabiullina directly stated that preferential mortgages should be completed in July next year. Only targeted forms of support for housing lending should be retained, for example, family mortgages. At the same time, the authorities decided to tighten the requirements for the current program. And this is not only an increase to 30% of the down payment. From December 23, it will no longer be possible to take out an additional loan amount (the so-called combined mortgage) at market rates using preferential mortgages for new buildings. Before this, the loan amount could be increased to 30 million rubles in the region of the “two capitals” and up to 15 million rubles in the rest. Now this opportunity will remain only within the framework of family mortgages and mortgages for IT specialists.

According to the head of the analytical center “Real Estate Market Indicators IRN.RU” Oleg Repchenko, by reducing the maximum loan amount to 6 million rubles, the authorities have practically curtailed preferential mortgages in the capital region. Now with a minimum contribution of 30% and a maximum limit of 6 million rubles within the preferential You can apply for a mortgage for an apartment worth no more than 8.5 million rubles. By Moscow standards, this is a small studio on the outskirts, so the demand for preferential mortgages and in general for new buildings against the backdrop of tightening the conditions of the state program will decrease significantly, but not catastrophically – there are still family mortgages on the market. However, sagging demand will put pressure on prices. Perhaps the cooling of the market will be more noticeable after July 1, 2024, if the authorities do not change their mind about turning off the state program of preferential mortgages for everyone. Removing massive rate subsidies will reduce demand. But buyers will only benefit from this: sales will decline, and developers will be forced to meet consumers halfway and revise prices, the expert emphasized.

However, there is an opinion that the only thing that the authorities’ decision to tighten the requirements for preferential mortgages will lead to is a redistribution of demand. Buyers will simply move out of town. “The drop in demand for comfort-class projects within the boundaries of old Moscow will be 30%, but the demand for projects in the Moscow region, on the contrary, will increase by 15-20%,” says Alexey Gusev, general director of Glavstroy-Nedvizhimost. According to him, changes in the requirements of the preferential mortgage program significantly narrow the availability of housing in the mass segment, primarily within the borders of old Moscow, where the share of mortgage transactions, according to open sources, accounts for more than 70%. Today, the average price of a comfort-class apartment within the boundaries of old Moscow fluctuates around 15.5 – 16 million rubles, in New Moscow – about 11 million rubles, in the Moscow region – about 9 million rubles. Based on this, we can conclude that projects in the first zone of the Moscow region will benefit, since the maximum permissible price of a lot, taking into account the new restrictions on preferential mortgages, is 8.6 million rubles with a down payment of 30%, the expert is sure.