“Strategic issue”: Russian Deputy Prime Minister Marat Khusnullin calls 9% mortgage rate a crime

To date, mortgage rates in Russia are still overpriced. On Friday, February 7, said Russian Deputy Prime Minister Marat Khusnullin at a conference call with the regions.

“A mortgage rate of 9%, I think, is a crime. We need to reduce it, for this we need to work out a number of measures, discuss this issue with banks, ”Interfax Khusnullina quotes.

According to the Central Bank, mortgage loans in Russia began to confidently become cheaper in the spring of 2019. So, from May to December, the rate decreased from 10.56% to 9% per annum and reached the lowest mark for the entire time of observation. At the same time, Marat Khusnullin still considers such dynamics insufficient to fulfill the tasks set by the president in the framework of national projects.

“We will not fulfill the housing program if we do not solve the issue of mortgages. Even if (rate. - RT ) is 5%, in our dreams, we even need to break the veins in order to build 120 million square meters. m and sell them. You can build, to whom we will sell them? Or will we drive everyone into mortgage bondage at 9% and people won’t eat? ”The Deputy Prime Minister added.

According to the Federal State Statistics Service, in 2019 the volume of housing commissioned in Russia grew by 4.9% - up to 79.4 million square meters. m. According to the objectives of the national project "Housing and urban environment", in 2024, the figure should reach 120 million square meters. m. At the same time, the national project involves a decrease in mortgage rates over the next four years to 7.9%.

“This is a strategic issue, we will discuss it in the near future,” Khusnullin noted.

According to experts interviewed by RT, a decrease in mortgage rates primarily depends on the actions of the Central Bank. Traditionally, Russian banks are closely monitoring the change in the key rate of the regulator and, based on decisions taken by the Central Bank, independently determine the level of long-term lending rates, including mortgage ones.

In 2019, the Central Bank lowered its key rate five times - from 7.75% to 6.25%. At the same time, during the first meeting in 2020, February 7, the regulator again lowered it by 0.25 percentage points to 6% per annum. The value has become the lowest since March 2014.

By reducing the key rate, the Bank of Russia intends to stimulate business activity and economic growth in the country. In the long run, the policy of the monetary authorities should lead not only to cheaper loans, but also an increase in domestic demand and investment.

In many respects, the change in the key rate of the Central Bank is affected by the dynamics of consumer prices. In January, annual inflation in Russia fell below 3% and reached 2.4% - for the first time since June 2018. According to analysts, such a decrease allows the regulator to more actively reduce its interest rate. As a result, it is expected that the mortgage in Russia will become cheaper faster than the forecasts laid down in the national project.

“The current situation with inflation should lead to a further reduction in the key rate up to 5% and even lower, which determines the total cost of loans. In 2020, the average mortgage rate may well drop to 7-8%, ”said Arseniy Dadashev, director of the Academy of Financial and Investment Management, to RT.

Moreover, as Vice-President of the Russian Guild of Realtors Oleg Samoilov noted in an interview with RT, today in Russia you can see rates below 9%. This is largely due to state social programs. First of all, we are talking about a mortgage at 6% per annum for young families and at 2% for residents of the Far East.

Issue price

According to analysts, lowering mortgage rates to some extent will help keep the expected increase in property prices. According to the forecast of the head of the analytical department of AMarkets Artyom Deyev, in 2020, on average in Russia, housing can rise in price by 10%.

As experts explain, the transition to the project financing system for housing construction still affects the value of real estate. From July 1, 2019, developers can no longer attract money from equity holders directly. Now citizens place their funds for the purchase of housing on the so-called escrow accounts. This is a special bank account for the safe conduct of transactions between companies and the public.

Money for the purchase of real estate is stored in the bank until the developer fully fulfills its obligations. So, for example, a construction company will be able to receive funds from interest holders only after the introduction of housing into operation. The performers themselves will carry out construction work at the expense of bank loans.

“After the introduction of project financing in 2019, the costs of developers increased, the cost of housing on average in Russia increased by 8-10%. In 2020, the price increase may reach about 10%, but further rise in price per square meter will already be unprofitable for companies. The market is now very close to the highest bid price, so if developers continue to raise prices, home sales will stop growing, ”said Vladimir Savchenkov, CEO of Fly Planning, APRI.