Page 29 - RusRPTAug24

More than three quarters of new mortgages were issued under the subsidy program in recent months, according to the central bank, adding to the booming banking sector profits, but borrowing is likely to fall heavily as mortgages transition to the market rates. The CBR expects a slowdown in mortgage portfolio growth to 7%-12% this year from 30% in 2023.
Government data show the volume of construction increased by 16% in the past two years and the amount of new housing in 2023 was the highest since 1990. Housing purchases amounted to 11% of gross domestic product last year or RUB18 trillion ($210bn).
Property prices in Moscow rose an average of 15% in June compared to a year earlier, to RUB366,400 rubles (about $4,250) per square meter, according to data by Cian PLC, an online property platform. That puts the average price of a 60 square-meter apartment in the Russian capital at almost RUB22 million rubles.
Prices of homes in Russia’s largest cities nearly tripled between 2020 and 2023, according to the Moscow-based Institute for Urban Economics research, cited by Bloomberg.
Previously Ministry of Finance (MinFin) has tried to slow the subsidy-fuelled real estate boom by tightening borrowing conditions. New rules restricted access to the 8% mortgages by raising the minimum down payment to 30% of the total house price from 20% in December and limiting the maximum loan to RUB6mn, down from RUB12mn in Moscow and St. Petersburg.
A special program targeting families with at least two children will continue until 2030 after Putin called for it to be prolonged, while another for IT specialists will stop at the end of this year.
Moving to market rates will cut off a large share of the population from the ability to buy a new apartment. Alexander Isakov, head of Russia and CIS macroeconomics at Bloomberg, calculates that loan of RUB6.3mn over 25 years costs close to RUB100,000 per month at 18% interest, according to a mortgage calculator by the state-run Dom.rf financial developer for housing. Just 11% of Russians have a monthly income higher than RUB100,000, according to Federal Statistics Service data.
2.7 Russian oil revenues are down despite higher export volumes
Russian oil revenues are down despite higher export volumes, Kyiv School of Economics (KSE) reports in its latest Russian oil tracker.
Russian oil export revenues fell by $0.6bn to $16.8bn in May, despite higher export volumes. Increased exports (+4% MoM) and the active use of the shadow fleet did not compensate for the lower oil prices.
29 RUSSIA Country Report August 2024 www.intellinews.com