Real estate market participants appreciated the Central Bank's decision to reduce the key rate to 16%

The reduction of the Central Bank's key rate to 16% was an expected step, given the slowdown in annual inflation and the recent favorable forecast of the Central Bank. Svetlana Pinigina, the founder of Pinigina Consulting, told Izvestia about this.

"In December, annual inflation slowed to 5.8%. And by the end of the year, we see trends towards a continued slowdown in economic growth, which suggests a move in an optimistic direction, despite the apparent general instability of the market," the expert noted.

Olga Nart, Deputy General Director of the Luchi resort, added that at the current stage, the Central Bank proceeds from the need to take into account a wide range of factors affecting the economy, rather than focusing solely on the rate level.

"That is why the current decrease to 16% was insignificant. The practice of the Bank of Russia's recent decisions demonstrates a cautious approach to changing the key rate," the expert said.

The reduction in rates encourages those who have been postponing the purchase of housing in anticipation of more favorable conditions, said Victoria Anokhina, Commercial Director of Razvitie Group. However, further monetary policy easing is needed to fully restore demand. According to our estimates, stable demand for housing can be expected at mortgage rates in the range of 10-12% per annum. This level will become real only if the Central Bank's key rate is about 8%.

"At the current stage, government preferential mortgage programs play a key role in maintaining demand. They allow you to purchase housing at rates significantly lower than market rates. As the key rate decreases, demand is expected to gradually shift to market conditions," she said.

However, this tool will become truly widespread again when mortgage rates reach 12%, added Ilya Kolunov, CEO of Sadovoye Koltso Group.

"We expect that the key rate will continue to decrease in 2026. The most optimistic scenario is a decrease to 12% during 2026. This will allow us to launch a period of growth, the expectation of which has been delayed, since the whole of 2025 was spent in a cooling mode and expectations of a rate cut and increased availability of financial instruments," Nart summed up.

"For investment growth, the key rate should be below 10%"

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Earlier in the day, the Central Bank lowered its key rate to 16% per annum. At the final meeting of the Bank of Russia in 2025, the Board of Directors decided to reduce the key rate by 0.5 percentage points from 16.5% to 16.0% per annum. The next meeting of the Board of Directors of the Bank of Russia on the key rate is scheduled for February 13, 2026.

Valery Tumin, a member of the Expert Council on the Development of the Digital Economy under the State Duma Committee on Economic Policy, told Izvestia on December 10 that at the December meeting of the Central Bank, the regulator could consider two possible solutions: lowering the rate to 16% or keeping it at the current level of 16.5%. He recalled that the Bank of Russia had previously set a benchmark for an average rate in the range of 13-15% in 2026.

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