What awaits the residential real estate market this year

The first working week of the New Year 2024 has begun, and already now we can draw preliminary conclusions about what awaits the residential real estate market this year. Due to the announced plans of the Central Bank of Russia to regulate the real estate market for 2024, it is worth paying attention to the expectations and forecasts of experts.  

One of the key changes that came was an increase in the down payment on mortgage loans to 30%. This change is aimed at stabilizing the market and preventing possible risks associated with lending. In addition, the regulator plans to introduce a single standard for mortgage lending, which may also affect the dynamics of the real estate market.

Last year, repeated increases in the Central Bank's key rate and an increase in the minimum down payment on a preferential mortgage stimulated buyers to purchase real estate before the new conditions came into force. Despite this, demand for housing turned out to be higher than expected, and the average level of mortgage transactions amounted to more than 80%, of which 90% accounted for preferential programs.

Mortgages remained the main driver of demand for real estate in 2023. Government-supported programs such as family and IT mortgages were particularly popular. However, with the tightening of concessional lending conditions, experts predict a negative impact on demand volumes in 2024.

Recent changes in legislation indicate that the state is moving towards reducing preferential programs. In the first half of 2024, as long as preferential mortgage programs are in effect, even under new conditions, the primary real estate market will continue to grow.

Despite changes in lending conditions and a possible decrease in demand, experts do not see any prerequisites for a decrease in real estate prices. The cost of construction continues to grow, and high-quality projects are always in demand.

Thus, the St. Petersburg residential real estate market in 2024 may face challenges related to tightening credit conditions and reducing preferential programs. However, despite this, it is expected that housing prices will remain stable and the primary real estate market will develop dynamically.