What will happen to house prices in 2025. Dissection
In 2025, apartments in old panel houses and new buildings at the excavation stage will become cheaper in Russia. However, the cost of almost ready apartments and secondary market properties in new housing stock may increase. In addition, rental prices are expected to rise. What will be the Russian real estate market in 2025 and what will most strongly affect it - in the material "Izvestia".
What will happen to housing prices in 2025?
- At the end of last year, the average cost per square meter in new buildings in Russia increased by 6%. If the market situation in 2025 will not change much, the growth is expected at the level of 6-8%. However, it may be lower, provided that inflation is lower.
- At the same time, experts do not rule out an increase in the cost per square meter up to 10%. This is how developers can compensate for rising construction costs.
- Some experts are sure that under favorable economic conditions in the country, the real cost of housing in 2025 may be lower than last year's level by 20-30%. This is primarily due to the "extremely inflated bubble" in the residential real estate market due to preferential mortgage programs.
- In particular, experts expect that in Moscow prices may fall from 12 million rubles for a one-bedroom apartment to 9-10 million rubles, in Sochi housing will fall in price from 11 million to 8-9 million rubles for a "one-bedroom", and in St. Petersburg - from 7.5 million to 5.5-6 million rubles.
- In October, the Chairman of the Bank of Russia Elvira Nabiullina already pointed to the beginning of the decline in prices for new buildings. According to her, the decline has started both in the country as a whole and in some regions. This trend should reduce the price gap between the primary and secondary market, which is now 44%.
- However, most experts emphasize that a quick correction in housing prices should not be expected. Many developers have formed a sufficient capital reserve not to move to a sharp decline in the cost of objects. Moreover, the high key rate directly affects the cost of project financing.
According to Rosstat data, housing commissioning in Russia in January-November 2024 amounted to 93.8 million square meters, which is 0.7% more than in the same period of 2023. In terms of the volume of housing construction during this period, the top 5 subjects of Russia continue to be headed by the Moscow Region, where 9.9 million square meters were built during this period. Krasnodar Krai, Moscow, Leningrad Region and the Republic of Tatarstan are also in the top five.
What is happening to the secondary market
- In the secondary market, many property owners who were planning to sell their real estate continue to reorient themselves towards renting it out. In the current conditions, price reduction is possible only for illiquid objects or in the case when the seller needs to urgently realize the property.
- According to the results of 2024, the largest decrease in prices for secondary real estate is noted in the Khanty-Mansi Autonomous District - 7.7% compared to December 2023. The second and third places are occupied by the Karachay-Cherkess Republic (-5.7%) and the Komi Republic (-3.9%).
What will be the cost of rent
- Rental rates in the country, despite constant growth, have not yet reached the pre-pandemic level. Last year alone they increased by 30% and will continue to rise in 2025. The cost of rent depends on demand, which, in turn, is shaped by the key rate and current mortgage conditions.
- Most Russians still prefer a 20-30 year loan to renting an apartment. Thus, rental rates will increase in proportion to the income of tenants, but within the limits of inflation.
What will influence the cost
- Demand and prices will depend on many factors: the level of the key rate, inflation rates, the availability of preferential mortgage programs and various discounts and promotions from developers, as well as the macroeconomic situation and construction activity in the regions.
- The probable decrease in demand may be compensated by a reduction in the launch of new projects due to the risk of a significant increase in the credit burden for developers.
- However, the price growth in the market may be fueled by a decrease in bank deposit rates, which will bring money from deposits back to the real estate sector.
- The Central Bank believed that by the end of 2024, inflation may amount to 9.6-9.8% year-on-year. And in 2025, according to the official forecast, inflation may fall to 4.5-5%. However, the Ministry of Economic Development promised to clarify the inflation forecast for 2025 by April, as it is already clear that its level exceeds the expected 4.5%.
What benefit programs remain
- The large-scale program of preferential mortgages, which was launched in 2020, ended on July 1, 2024 , and some banks stopped accepting applications early, explaining it by the exhausted limit. Under the terms of the preferential mortgage it was possible to buy an apartment at 8% per annum with a down payment of 20%. Because of its completion, 66% of Russians postponed the purchase of housing to save up funds.
- Since December 2023, the rule has been introduced, according to which a preferential mortgage can be issued only once. This applies to all preferential programs with state support. The requirement applies to co-borrowers and guarantors of the loan. Preferential loans originated before December 23, 2023 are not counted.
- Market mortgage rates at the beginning of 2025 exceed 28-29% per annum. But there is an opportunity to take out a housing loan at a rate several times lower. For example, using a family mortgage at 6% per annum or a rural mortgage at 2%.
- Employees of IT-companies will also be able to get a preferential loan for the purchase of housing in 2025 . From August 1, 2024, the government extended the program until the end of 2030, excluding Moscow and St. Petersburg.
- In addition, Russians living in the Far East and the Russian Arctic in 2025 will be able to take out a Far Eastern and Arctic mortgage. The terms of these two programs are similar. Both programs are valid until the end of 2030. Preferential loan at a rate of 2% per annum can be issued to young families, recipients of the Arctic and Far Eastern hectare, teachers, medical workers, employees of the defense industry moving to these regions. Among the requirements for program participants - registration in the territory of the region after obtaining the right of ownership for 271 days.
- In the State Duma allowed the emergence of four new preferential mortgage programs. It is assumed that they will be designed for young professionals and those who work in construction, science and industry.
In preparing the material "Izvestia" talked to:
real estate expert Natalia Pereskokova;
Konstantin Barsukov, member of the Russian Guild of Realtors, real estate market expert.
