Fewer And Fewer New Housing Are Being Put Into Operation In Moscow

In the first quarter of this year, developers brought 12 new residential projects to the market, which is one third less than in the same period last year. This is the minimum figure for the last five years, and in the mass segment it turned out to be zero at all

In the first quarter of this year, developers in Moscow brought 12 new residential projects to the market, which is one third less than in the same period last year, Kommersant writes with reference to the Metrium real estate agency. This is the minimum figure for the last five years, and not a single new project has appeared in the mass segment at all.

According to the Miel Group of companies, in Moscow and the Moscow region, a little more than 23 thousand apartments in new buildings went on sale in the first quarter, which is almost 29% less year-on-year, and if compared with the fourth quarter of last year, the figure has tripled.

Yana Pikulenko, Director of Analytics at RKS Development Group, tells about the reasons.

Yana Pikulenko, Director of Analytics at RKS Development Group, “Yes, indeed, in the last year there has been a negative trend from the peak period. If we look at a slightly broader period, then no more than 40 projects entered the market in 2020. If we talk about 2021-2022, then 60 new projects a year entered the market. That is, there is a drop, but it is exclusively relative to the last period of time. The key reason for the decrease in the output of new projects in 2023 was the tightening of the issuance of new construction permits. Many have heard that now Moscow has stricter requirements for projects, first of all faceless facades are prohibited, all developers have gone to redesign. Any redesign cycle is about a year, that is, in 2024-2025, many interesting products should enter the market. These will no longer be faceless, smooth facades, but some projects in which there will be individual author’s solutions. Therefore, in terms of whether it’s good for the market or bad, in my opinion, it’s very good.”

Nothing terrible is happening in the new housing market, says the head of NDV Group, Alexander Khrustalev:

Alexander Khrustalev, head of NDV-Group, “I think it’s too early to dramatize. This was also due to the fact that we had presidential elections in the first quarter, which delayed activity, including in business. A number of commissions have been postponed to coordinate various projects in Moscow, in the Moscow Region, and in the regions. Therefore, I think it’s only because of this. There will be some kind of correlation, but I cannot say that developers have significantly reduced their presence. Now we have more than a dozen developers watching more than a dozen sites, considering, counting and, of course, taking into account the fact that money is now worth other money. And that’s it, nothing else. The consumer pays for everything. Prices, most importantly, will not go down. Prices can go down for very expensive business class and premium projects, where there is an opportunity to fall. And where economy, comfort class, there can be no big drop. Because money costs money, banks keep their covenants and do not allow you to sell property at a loss. That’s the whole story, that is, it is more profitable for banks to keep.”

According to CIAN Analytics, in the first quarter of this year, the total area of residential new buildings for sale in Moscow and the region amounted to 1.4 million square meters, and in St. Petersburg and the Leningrad region – 665 thousand square meters.

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