The expert assessed the impact of the new bankruptcy law on housing prices

The adoption of a new law on bankruptcy of mortgage debtors will not stimulate the real estate market, its effect will be "rather ambivalent." This was stated to Izvestia by Dmitry Shchegelsky, President of the National Chamber of Real Estate, CEO of the Benois Real Estate Agency.

He noted that although the law makes the procedure for selling mortgage apartments more transparent and predictable, one should not expect an active increase in real estate prices or an improvement in housing purchase conditions. Simplifying the allocation of funds for the sale of a single mortgage-backed home does not necessarily lead to a market upturn.

Theoretically, according to the expert, the law is able to increase the number of transactions: banks will receive a more understandable mechanism for refunding funds, and the objects themselves will reach the auction faster. However, if the number of problem mortgages increases, the opposite effect is possible.

"If there are a lot of such sales, this will create pressure on prices, because objects from auctions are usually sold at a discount and become a new benchmark for the market. As a result, prices for similar apartments may decrease, and the time frame for their sale may increase," the specialist warned.

For buyers, the appearance of more objects at auction opens up opportunities to purchase housing cheaper than the market price, but such transactions remain legally complex and often involve risks, the source added.

"In general, the law increases the liquidity of distressed assets, but with an increase in delinquencies and bankruptcies, it is he who is able to increase price declines. This is not an incentive for growth, but a tool for adapting to possible market risks," Shchegelsky concluded.

Read more about the impact of the new law on the sale of mortgage housing in bankruptcy on the real estate market in the Izvestia article.

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