Mortgage demand in the first half of September was 20% lower than the highs in August this year. Tatyana Reshetnikova, deputy head of the mortgage department of the federal company Etazhi, told socialbites.ca.
“This situation is fully justified by the fact that demand was much higher in July and August, despite the increase in the key interest rate and changes in concessional loan conditions. “Many of those who planned to buy real estate later accelerated their purchasing decisions,” he said.
Reshetnikova explained that if we compare the demand for mortgage advice, Russians are 25% less interested in loans for the purchase of second homes than in July and 31% less than at the August peak. The expert added that there is still excitement in the primary market, interest in preferential mortgage programs is 49% higher than in July and only 2% lower than the peak values of August this year.
According to him, in early September, a fairly large number of potential buyers of new buildings were in a hurry to take out a mortgage with a minimum down payment, and in the secondary market, many buyers are now planning to buy an apartment at a discount and in the future to refinance the loan at a lower rate. Additionally, Reshetnikova said that some banks are now maintaining various preferences where the interest rate can be reduced by 0.7 percentage points.
On July 21, the Central Bank increased the policy rate by 100 basis points to 8.5% annually. On August 15, the rate was increased by 350 basis points to 12%, and on September 15, it was increased by 100 basis points to 13%. The regulator explained that inflation pressure remains high. The Russian government increased the minimum contribution for concessional mortgages from 15% to 20%.
Mortgage interest rates increase after the Central Bank increases the interest rate. For example, after the interest rate was increased to 12%, mortgage loan interest rates increased by 1.5-2 points. up to 14% at various major banks. People often try to get a loan before interest rates increase.
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Source: Gazeta
Ben Stock is a business analyst and writer for “Social Bites”. He offers insightful articles on the latest business news and developments, providing readers with a comprehensive understanding of the business world.