The Bank of Russia is observing a slowdown in the pace of price growth for new housing across several regions, while the gap between new-builds and existing homes remains substantial. This was stated by Central Bank Governor Elvira Nabiullina during a press briefing. (Source: Central Bank of Russia)
In nearly a third of regions, transaction prices in the primary housing market have declined. That decline is taken as a clear signal that the market is adjusting. The spread between prices for primary and secondary properties remains wide, but over time, market participants anticipate that this gap should narrow as supply, demand, and policy settings move toward balance. (Source: Central Bank of Russia)
According to Nabiullina, price adjustments in the housing market are expected to unfold gradually rather than occur rapidly. She noted that the long-term concessional mortgage program has contributed to earlier rapid price increases, and its evolution is shaping current trends. (Source: Central Bank of Russia)
“A balanced growth in mortgage issuance should improve overall housing affordability. It should affect the true cost of housing itself, not just the cost of securing a loan through favorable rates,” the central bank governor explained. (Source: Central Bank of Russia)
Nabiullina also highlighted the stability of developers’ finances, supported by a cushion built up from favorable market conditions in prior years. This resilience helps sustain a measured trajectory for new constructions and project financing. (Source: Central Bank of Russia)
Earlier information indicated that the secondary housing market in Russia would reopen in August 2024, with prices rising more quickly than in new-build properties. In the secondary market, the average price per square meter rose 0.7% to 116.1 thousand rubles, while the primary market saw a 0.6% uptick. Analysts attributed the pricing divergence to the withdrawal of preferential mortgages for new construction, which dampened demand for fresh units relative to existing stock. (Source: Central Bank of Russia)
Resale apartments in popular resort areas, including the Krasnodar Territory, also experienced price increases, reflecting ongoing demand in regional markets. These dynamics illustrate how policy measures, lending conditions, and regional demand interact to shape the affordability landscape for buyers in both major urban centers and tourist destinations. (Source: Central Bank of Russia)
In the context of North American markets, the broad takeaway is that gradual price normalization in new construction can support steady affordability improvements, especially when mortgage access remains predictable and sustainable. Buyers and investors watching the Russian market may compare it with local trends in Canada and the United States, where mortgage rates and housing supply continue to influence price trajectories. Market observers should note that shifts in government support for housing finance can have lasting effects on both price levels and the pace of transactions. The current Russian experience underscores the importance of a measured approach to mortgage policy and developer financing in sustaining market balance, even as regional variations persist. (Source: Central Bank of Russia)