Elitnoye.ru portal learned from experts whether it is worth waiting for recovery next year. Growth is possible, but at a very slight pace
In the current economic and geopolitical conditions, one can only guess what awaits the Moscow housing market in 2023 by coffee grounds. This year has been a series of ups and downs. The result was negative, but still not as expected. Will the industry cope with all the difficulties next year? Moreover, important changes are coming. The market of new buildings expects an increase in the rate on the preferential state mortgage program from 7% to 8%. They also cancel near-zero mortgages from developers.
At the same time, the solvency of the population is decreasing. An increase in the price of housing loans will inevitably reduce demand, the number of mortgage transactions will decrease, and the exposition period will increase. Some buyers may go to the “secondary”. And the competition between the two markets, perhaps, will allow prices to return to reasonable values. Moreover, today the market has become a buyer's market. Both developers and owners will have to adapt to its financial capabilities. The year is expected to be difficult, but not dramatic. Most likely, the market will begin to recover very slowly, but still recover. The Elite.ru portal learned from experts what the industry expects in 2023.
Ekaterina Berezhnova, chief analyst at Miel:
– The market for new buildings is going through difficult times: since the end of September, there has been a decline in sales. After the fall in demand in the primary market of Moscow in October, the number of transactions increased significantly in November due to the market rebound in the “old” Moscow.
As a result of November, 5.46 thousand DDUs were concluded in Moscow (including New Moscow), which is 29% higher than in October. Nevertheless, compared with November last year, there is still a decrease in demand by 35%. In November, 4.29 thousand DDUs were concluded in “old” Moscow (plus 43.5% per month), which made it possible to catch up with the June figures (4.23 thousand DDUs). In New Moscow, demand decreased by 5%; in November, 1.2 thousand DDUs were concluded. In annual dynamics, demand is lower by 47.4%.
In the old borders of Moscow, supply prices in November remained at the same level: at the end of November, the average price per square meter. meters amounted to 344.8 thousand rubles (minus 0.3% per month). But the price per sq. m in the transaction decreased by 5.5% and amounted to 283.9 thousand rubles.
Given that the possibility of preferential mortgages remains, now developers, and buyers, will not make sudden movements. Prices will remain at the current level until the end of January. Now the holidays are coming, and the market is freezing. What will happen in February is not yet clear. The real estate market is highly dependent on economic and political factors. As long as they continue their influence.
Miel Managing Director Alexander Moskatov:
– From May to October, the volume of supply in the secondary real estate market in Moscow increased, in November there was a slight decrease. By December, we came up with an indicator of 50.1 thousand objects. In terms of the number of calls, October was the most active. November was somewhat weaker, in December the decline continues. It seems that the market has come to a balance of supply and demand in the conditions that exist today. I mean exactly the conversion into transactions.
The secondary market will most likely end December with rather high sales figures. At the end of the year, Rosreestr traditionally closes transactions in an accelerated mode, while in other periods of the year, transactions could be postponed to the next month. All of them will be included in the December statistics.
Preferential mortgages in the new-build market have spurred demand very strongly and led to a price increase of 20% per year for two years. As a result, the value of the primary property exceeded the value of the secondary property. Termination of the preferential mortgage program for the secondary market would be a positive factor, since it would add demand to the secondary market, since the preferential mortgage attracts some buyers. But a decision has been made to extend the preferential mortgage, so the downward trend in the secondary market is likely to continue.
Chase R. E. S. CEO Maya Pavlova:
– Further development of the situation depends on the decisions made by the authorities and their implementation. It is very difficult to predict in the current realities, there are many “ifs” and “buts”. So far, we see developers expecting the real estate market to level off in 2023. Developers are obviously not going to lower prices much and will keep demand with any new programs.
Since the preferential mortgage was extended, we still expect an increase in demand for the purchase of housing in new buildings in 2023. In 2023, a preferential rate for secondary real estate may appear, as well as the widespread emergence and popularization of housing leasing – long-term rental of apartments with subsequent purchase. So far, apartment leasing does not seem very profitable for developers, since they will have to wait more than 10 years to receive the proceeds from the sale of a property, but if the state takes this issue seriously and provides additional support, this story may become interesting.
So far, new objects are coming out, and we know the projects that are getting ready to start. Developers remain active, and they do not change their plans to launch new complexes. The volume of supply has already increased significantly due to the apartments of people who have left the country. In 2023, we predict a further increase in exposure. Many investors are afraid of falling real estate prices and want to get out of projects, having received their margin now. That is, those investors who purchased an apartment, for example, with the expectation of 30% profit, prefer to get rid of housing today, earning only 15-20%, but in this way reduce their risks.
Real estate prices will fall, both for sale and for rent. But there won't be a big drop anyway. Developers are likely to continue to give discounts to their customers after the New Year. Discounts may continue until demand is fully restored.
Regional Director of the Urban Real Estate Department of NF Group Andrey Solovyov:
– Today, it is difficult to predict the future development scenario for the elite segment, as well as for the entire market as a whole. As the experience of past crises confirms, premium and luxury real estate retain the status of the best way to save money from inflation and currency fluctuations, a “safe haven” for capital investment, maintaining interest from wealthy buyers.
At the beginning of next year, current trends are likely to continue. Recently, the average offer price has shown a slight increase, mainly due to structural changes in supply. Therefore, in many respects in the next year, the dynamics of the exposition will be influenced by the projects in which sales begin. But we will continue to live in the realities of the “buyer's market” and the search for that very balance of supply and demand in the new conditions.
As for mortgages, for the elite market “dependence” on it is not so high: the share of mortgage transactions does not exceed 30%, especially since the maximum amounts for preferential mortgages for the elite segment are not large. At the same time, in the elite segment, alternative forms of payment are in high demand (up to a third of all transactions): installments from six months, deferred payments until the end of construction, etc. % of the cost, especially with individual discounts.
Managing Director of Miel Maria Zhukova:
– During the year, the downward trend in demand and growth in supply in the Moscow rental market continued. The general trend is to reduce prices, but it is very slow. The number of apartments is quite large, today more than 40 thousand of them are presented daily. And this number is growing all the time.
It is, of course, difficult to make any predictions. Much depends on how the macro- and microeconomic, as well as political situation will develop. If everything goes the way it is now, then there will be no significant changes in the rental market. In the first half of January, people will rest one way or another, in the second half a slight revival will begin. This is what happens year after year. In the future, much will depend on the labor market. New enterprises, new jobs will begin to appear, people from the regions will again go to Moscow, the demand for rental housing will begin to grow.
Director of the suburban real estate department of the company NF Group Tatyana Alekseeva:
– The development of the suburban residential real estate market will continue in 2023. We expect an increase in development activity, the release of new projects in all classes and segments. In the elite segment, the withdrawal of new settlements is likely to be more restrained than in more budget formats, where a number of large developers from the urban segment have development plans. Nevertheless, the launch of two or three new settlements is possible next year.
The price indicators of new projects will be determined by the location and the product. General market indicators will be adjusted based on the impact of newly released volumes. Given the significant cumulative price growth in the primary suburban market over the past two years (plus 105% cottages, plus 49% townhouses, plus 9% land since the end of 2020), further price dynamics will be moderate.
Buyers are interested focus on innovative projects. Given the deficit in the primary market, observed over the past few years, we can talk about the presence of pent-up demand. It can certainly be implemented in new settlements with a competent concept and a quality product that meets the requirements of buyers.