In Russia, housing prices have climbed faster than typical incomes, even as new construction programs offer some benefits. This assessment came from Alexander Danilov, who oversees the Banking Regulation and Analytics Department at the central bank, during the All-Russia Conference on Mortgage Lending. The discussion highlighted how price trends in both the new-build sector and the secondary market are reshaping what people can actually afford to buy and how households plan their finances for long-term housing, a topic that remains central to the country’s financial and real estate landscape.
Danilov emphasized that housing costs have surged not merely in isolation but at a pace well beyond the growth of wages for the average worker. The outcome is a stagnation or even a decline in housing affordability, even as additional government programs designed to assist buyers come online. The takeaway for many households is that the barrier to entry in the housing market has grown taller, and the promise of easier access through policy measures has not fully materialized for a broad swath of the population.
There is a notable divergence between the primary market, where homes are built and sold to buyers for the first time, and the secondary market, where previously owned properties are traded. In recent periods, the gap widened to the point where newly constructed homes in the primary market have become markedly more expensive than those in the secondary market, creating a paradox for buyers who might expect new properties to be the more affordable option. This shift has implications for negotiations, mortgage sizing, and long-term financial planning as buyers weigh the benefits of newer construction against price realities in the surrounding market.
Looking back to 2019, the cost barrier to acquiring a new apartment in the primary market required a savings horizon of roughly six years for an average household. Today that horizon has extended to about eight years, underscoring a clear erosion of purchasing power for the prospective buyer. Although new and targeted programs aimed at easing entry into home ownership have appeared, their potential to broaden access appears to be diminishing as prices continue to rise and the macroeconomic environment tightens.
Officials from the construction and housing sectors have noted persistent pressure on per-square-meter costs. While some improvements in project quality and the efficiency of delivery are acknowledged, several cost components have moved higher, including the price of building materials, financing for development projects, and overall sales velocity. In parallel, land costs and infrastructure requirements continue to influence the final price tag, reinforcing the message that downward pressure on prices in the near term remains uncertain. The net effect is a housing market characterized by higher entry costs, steadier demand, and ongoing policy debates about how best to balance affordability with the need for new housing stock and infrastructure investments.