Photo: Natalia Chernokhatova/TASS
What is the reason for the current collapse in real estate prices? A number of versions that seriously pass off as serious analytics are simply shocking in their fantasticism. In particular, the idea was thrown in that the so—called “relocants” are to blame for everything – that’s how it’s now customary to call emigrants. They say that they, like the Karlssons, flew away, and that’s why everything fell so much. Although, in fact, the reasons are by no means in them — no one has yet abolished the basic economic laws.
According to a certain Flip investment company, in 2022 exactly half of the sales in the secondary real estate market throughout the Russian Federation were made through a notarized power of attorney. It seems like a record — in 2021 there were no more than 20% of such cases, in 2020 – 15%, in 2019 – 8%, in 2018 – 5%.
According to the above-mentioned company, there were about 3.9 million transactions in total, and this figure already raises serious questions. It is very similar to the official data of the Federal Register for 2021, when 4.2 million transfers of ownership rights in the secondary real estate market were registered.
Translated into more understandable figures: Flip claims that about 2 million Russians have fled abroad and at the same time sold their real estate. They left — okay. But they were able to sell… Isn’t that a bit much?
“If we take average sales in 2021 as a benchmark, this is minus 50%, a fairly serious drop, sales of new buildings fell even more. If you look at what is happening in large cities as a whole, sales there have fallen by 60%,” said Alexey Popov, head of the CIAN analytical center, back in May last year.
Meanwhile, it was in May that real estate prices went down significantly for the first time, after which this trend only intensified. There are really enough people willing to sell, even more than that. But that’s all.
“As you can easily guess, in order for the deal to take place, in addition to those who want to sell, you also need to have someone who wants to buy this object. And it has such an opportunity, financially. Everything is fine with the first ones this year, including me. But there are no buyers. Basically. Because buying something that is obviously cheaper is a somewhat strange decision. Or are there other opinions?” — private realtor Tatyana Ivanova is sarcastic.
“Real estate transactions began immediately after February 24. Potential buyers and sellers were divided into two camps. Someone wanted to end their personal problems related to housing faster, someone decided to take a waiting position. Plus, the real estate market was largely influenced by protective mortgage rates at the level of 23%. The market has risen,” explains Angelina Kamneva, an expert in the field of mortgage lending and selection of new buildings.
With a mortgage, everything is really very sad. Numerous “unofficial” reports that this market is completely dead have finally begun to gain statistical confirmation. They are still embellished, but let the smart one understand. The National Bureau of Credit Histories (NBKI) suddenly announced that in the fourth quarter of 2022, the percentage of mortgage loan refusals increased to 46.2%. A record, that is, an anti-record.
Why is that? And here everything is simple. They are not fools sitting in banks, and they are more or less able to count risks. Firstly, there is a rapid decline in household incomes. Secondly, real estate depreciates no less quickly, that is, it can no longer be a security for loans (collateral). Thirdly, the very cost of square meters in the Russian Federation is completely inadequate to the economic situation, the purchasing power of the population, and everything else. Its cost is quite at the European level with salaries 10-20 times lower!
In 2020, the preferential mortgage program played a very cruel joke on the real estate market. Its prices have increased significantly — by 25-40% in the “primary” and by 15-20% in the “secondary”. Actually, this is exactly what stopped the program — apartments simply became unaffordable, and people no longer pulled out huge annuity payments.
In the current situation, there was talk about a “bubble” in the Russian real estate market. First of all, the mortgage bubble is being discussed, since the economic situation, alas, is not improving. It seems that mortgage lenders have the lowest percentage of loan defaults, but this is an official statistic that does not have faith.
Against the background of all this fuss, the “new emigrants” with the sale by proxy probably also played some role in the fall in prices. But it is difficult to assess it objectively. First of all, because we do not know the real scale of emigration, these data are not made public.
The mood among those who left is also very different, to sell their property in Very few people gather in Russia. It’s not expensive to sell it now, so it makes sense to leave it and just rent it out, most of those who left do exactly that. Actually, this is evidenced by the data on the growth of supply in the rental housing market, which, according to a number of estimates, has increased significantly. At the same time, there is somehow no strong drop in prices for rented housing, which simply indicates the injection of new facilities into the market, the owners of which do not really need money yet. That is why no one is trading too much, in the sense of lowering rates.
So, there are no sales of the above-mentioned two million real estate properties by emigrants. The mortgage, which provided more than 90% of the demand, has died. Prices are falling — there are no buyers at all. But the cost of square meters is not falling as much as it would have fallen if apartments and houses were sold at the prices at which people are willing to buy it. In this case, real estate would have fallen in price ten times. In other words, the ends do not meet.
Thus, it is worth recognizing that there is a real fake that falls apart even with a cursory economic analysis. Meaning? And he is, this fake, apparently, is purely political. They want to tell us all that Russians are leaving the country en masse, moreover, they are severing all ties with their Homeland. They sell their shelter here and become “non-returnees”. It’s like a trend — the deer are heading north. We need to do the same.
That is, anti—Russian propaganda is not direct, not blunt, head-on, but hidden, sophisticated. And that’s why it’s the most dangerous. Unfortunately, to deal with this in There is simply no one for Russia, and this applies not only to such economic stuffing. Sometimes the “officialdom” snaps, but only in the worst traditions of the late schizophrenic baba Lera — “you’re all lying.” The effect is purely negative — they don’t believe it.
The situation on the Russian real estate market and in the Russian economy is very difficult. That is, it is almost catastrophic. There is currently no de facto market of this kind, since there are no buyers — only sellers. A lot. The price range is also quite conditional, a war immediately begins for every stray buyer, where killer arguments in the form of discounts are used. These can now be up to 20-30%, there is information about more serious discounts. This applies specifically to the secondary market, the primary one is not considered in this case.
But in general, everything froze, because even on such conditions after the price increase in 2021, only a few agree. People do not have money, and sellers, in turn, are not yet ready to move down even more. The situation is stalemate. But no more than that. No one sells anything or flees overseas for permanent residence. And they are not waiting for us there.
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