Apartment spread: the price gap between primary and secondary reached 80%

The price gap between new buildings and secondary housing has reached 80%. In the second quarter of this year, such an indicator was in Central Russia, follows from the data of the Central Bank, which was analyzed by Izvestia. This creates risks for citizens. If a person buys an apartment on credit in a new house now and fails to pay off the mortgage, then even after the sale of housing, he may still owe the bank, the regulator warned. Elvira Nabiullina also called the difference of 40% a blatant imbalance. Why the trend continues anyway is in the Izvestia article.

Why are prices for new buildings rising?

The gap in housing prices in the primary and secondary markets is getting bigger. In April – June of this year, the average in Russia reached 60%, according to the Central Bank. The average price of one square meter in the primary for all apartments exceeded 205 thousand rubles, and in the secondary amounted to 128 thousand.

At the same time, the gap was even greater in some regions. In Central Russia, it reached 80%. The cost of a meter in new buildings exceeded 294.1 thousand rubles against 163.8 thousand rubles in old apartments. The difference was slightly less than the national average in the north-west of Russia (57%), and in Siberia — 44%. The smallest price gap was in the North Caucasus (only 12%) and the Far East (16%).

A large difference in the cost of apartments in the primary and secondary markets carries risks for Russians, the Central Bank noted. One of the dangers is that a person who has bought an apartment in a new building with a mortgage may face losses if necessary to sell the property.

So, if the borrower is unable to repay the loan and wants to sell the house, then it will cost much less on the secondary market. Because of this, a person will lose the invested money and may even owe the bank if they are forced to sell such an apartment at a price below the purchase price, the Central Bank clarified to Izvestia.

The active growth in prices for new housing originates in 2020. Then there was a preferential mortgage: a massive government program at 7%, which was available to all Russians, said Ekaterina Shchurikhina, Director of bank ratings at Expert RA agency. The demand for housing has artificially accelerated.

In just three years, the gap between prices for secondary and new buildings has increased from 10% to 40%. This cannot be explained by the natural difference between the quality of old and new housing, said Central Bank Chairman Elvira Nabiullina. She called this difference a blatant imbalance.

In July 2024, the massive preferential mortgage on new buildings was canceled, but other government programs remained. The gap in the price of primary and secondary continued to grow. During the year, it increased on average in the country from 55 to 60%.

Now the main driver of the market is a program for families with children under six years old, which now accounts for about 80% of all housing loans, Izvestia estimates. Family mortgages also provide demand for new buildings, which is why they continue to rise in price, Ekaterina Shchurikhina said.

Former in increase: demand for secondary increased after a decrease in key

The cost of housing may rise by 5-10% due to the activity of buyers

Since April 1 of this year, family mortgages have been expanded to the secondary market. However, a preferential loan for the purchase of an apartment in an old building can only be issued by residents of cities with a low level of construction, where either they do not build apartment buildings at all, or their number does not exceed two. However, the program does not apply to rural settlements. There are not too many such places in Russia. In July, this list included 884 cities across the country.

In addition, primary housing is now becoming more expensive due to high construction prices, said economist Andrei Barkhota. Not only the cost of materials is increasing, but also the cost of workers' salaries, because there is a shortage in the labor market due to record low unemployment (about 2.2%).

At the same time, prices for secondary housing are stagnating, because demand for apartments in these buildings is not fueled by government programs, and mortgage rates are at a barrier level of about 26-30%, said Evgeny Shavnev, CEO of Flip investment company. In addition, sellers of second homes do not overestimate the cost much in order to reach a deal as soon as possible. Moreover, many of them are even ready to provide a 5-10% discount, which also affects the price dynamics.

Why is the price gap between new and old housing dangerous for the economy

— The high gap between the cost of housing in the primary and secondary markets is a serious imbalance that can worsen financial stability, — said Andrey Barkhota.

The price difference between new and secondary buildings is growing, and fewer and fewer Russians can afford an apartment in a new building, said Ekaterina Shchurikhina from Expert RA. There are fewer preferential mortgage programs, conditions for them are getting tougher, and many are no longer meeting the requirements, while the usual loan rates remain too high.

The overpriced price of new buildings makes them inaccessible to many families who would like to exchange their old homes for new ones, said Vladimir Chernov from Freedom Finance Global. Buying an apartment in a newly rented house due to the sale of second-hand simply will not work due to the price difference.

This is also a risk for banks: the amount of the sale of a secured apartment may not cover the entire debt, Ekaterina Shchurikhina said. However, the percentage of mortgage delinquencies remains under control, so mass sales of such lots are not expected.

At the same time, the gap in housing prices in new buildings and old houses differs significantly from city to city. For example, in Moscow, the difference in the cost per square meter is only 8% (407 thousand to 377 thousand), in St. Petersburg - only 4% (278 thousand to 267 thousand), follows from the data of the Central Bank.

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And in some areas, the situation is reversed. So, in the Krasnodar Territory, the secondary is even more expensive than the primary by 14%. This indicator depends on the demand for new buildings. And their sales in a number of regions have halved, Izvestia wrote. The market shrank the most in Krasnodar, Krasnoyarsk and Samara.

Nevertheless, the national average price gap between new and secondary buildings will continue to grow until the end of the year. It may increase from the current 60 to 65-70% if the demand for primary energy remains, said Vladimir Chernov. A double-digit increase in prices for new buildings is possible with the continuation of preferential programs, a shortage of supply and maintaining high construction costs.

A strong reduction in the key rate from the barrier level of 18% would help solve the problem — this would largely equalize secondary housing with new buildings, Vladimir Chernov believes. If the rates on market programs fall below 10%, demand for them may increase significantly, which will ensure a gradual increase in prices.

The Bank of Russia considers the high gap in the cost of housing to be a sign of a "bubble" in the real estate market, which can undermine financial stability, Andrei Barkhota concluded. According to the regulator, the problem can be solved only through prolonged cooling of the credit segment. However, with falling market rates expected by the end of the year, buyers will begin to actively switch to recycling, which may worsen the problems of developers.