Prices for secondary housing in Russia 2023, forecast

Thanks to strong demand, the average cost of resale property in the largest regional markets in Russia continues to grow slowly. The activity of potential buyers is dictated by their outflow from the segment of new buildings, whose share in the total structure of transactions decreased from 37% to 30% over the year. But the demand is concentrated mainly on liquid objects with repair suitable for living. Market participants do not expect significant fluctuations in the secondary market, warning that much now depends on the external environment and the decision of the Central Bank on the key rate.

The average cost of secondary real estate in the 18 largest regional markets of Russia (16 million-plus cities, Moscow and Leningrad regions) in May amounted to 126.5 thousand rubles. per sq. m, an increase over the month by 0.7%. Such data are provided by CIAN.Analytics experts, recalling that a similar trend has been typical for the past few months. According to the “Etazhy” data, the average cost of a secondary house in Russia as a whole is now 112.6 thousand rubles. per sq. m. Over the month, this figure increased by 0.6%, over the year – by 3.7%. The average cost of an apartment is 4.3 million rubles, they add to Avito Real Estate. This figure has not changed over the month, and the annual increase was 10.3%.

The most pronounced price increase for secondary housing over the past month, according to CIAN.Analytics, there was in Chelyabinsk, where the average indicator increased by 2.4%, to 76.5 thousand rubles. per sq. m. In Rostov-on-Don the dynamics was 1.5%, an increase to 111.8 thousand rubles. per sq. m. In Omsk, according to the calculations of the Floors, the average cost of the secondary housing increased by 1.9%, to 87.7 thousand rubles. per sq. m. In St. Petersburg monthly increase is estimated at 1.2% – up to 191 thousand rubles. per sq. m. In Moscow the dynamics was 0.1%, an increase to 301.2 thousand rubles. per sq. m, note in “CIAN.Analytics”.

The weighted average apartment in the secondary market of “old” Moscow, according to analysts from the company “Inkom-Nedvizhimost”, now costs 13.8 million rubles. Over the month, the indicator decreased by 0.3%. In New Moscow, the dynamics is less pronounced – minus 0.1% per month, a decrease to 9.8 million rubles. In the Moscow region, the indicator has not changed: the budget of the proposal is 6.6 million rubles. “Liquid apartments are in great demand, but the owners do not raise prices, preferring to sell quickly rather than experiment with value,” says Sergey Shloma, director of the Secondary Market division of Inkom-Nedvizhimost.

In May, according to Mr. Shloma, activity was twice as high as last year and exceeded April by 2%. “This is a unique situation, traditionally May is an inactive month due to holidays,” the expert says.

Transactions, according to his observations, are concluded quite quickly. Violetta Khachaturova, head of Apple Real Estate, says that a similar trend can be traced in the high-budget housing segment: “The cost is not growing, but there is no decrease in indicators either.” Demand has shown a positive trend over the past two to three months, she notes.

Relatively high activity is now observed in all major regional markets. The head of the secondary and out-of-town areas of Avito Nedvizhimost Sergey Khakhulin notes that demand increased by 41.6% over the year. Although in May it was still lower than in April, by 11.6%. Mr. Khakhulin draws attention to the fact that, as it becomes less profitable to buy new buildings, many buyers begin to give preference to ready-made offers. Sergey Shloma believes that about 20% of potential buyers of new buildings have moved into the segment. Alexey Popov, head of CIAN.Analytics, says that if last year new buildings formed 37% of the total volume of housing transactions in metropolitan agglomerations, now this figure has dropped to 30%.

Although, according to the director of “Etazhi” Ildar Khusainov, so far it is more about restoring the balance: for the past few years, the secondary housing has been under pressure from the primary supply.

The expert draws attention to the fact that buyers are increasingly inclined to purchase apartments that are currently best suited for living.

“They are interested in options with modern renovation, furniture and household appliances,” he says. A similar trend in the market was noticed by Mr. Shloma. If earlier realtors, according to him, did not recommend sellers to significantly invest in pre-sale preparation of objects, now the presence of repairs may become a reason for an extra charge.

Stable demand leads to a slow decline in supply. According to CIAN.Analytics, a total of 224 thousand ads are now available on the 18 largest regional markets, which is 2% less than a month ago. “This is due to the smaller number of new announcements that went into sale,” says Alexei Popov. In the secondary market of the “old” Moscow, according to Sergei Shloma, now exhibited 87.8 thousand lots. Over the month, the indicator decreased by 0.43%. 8.5 thousand offers are available on the market of New Moscow, 72.8 thousand – in the Moscow region. Over the month, the indicators increased by 1.5% and 0.1%, respectively.

Violetta Khachaturova does not expect a significant decline in demand or prices in the secondary market in the next few months, provided that the external background remains stable. Ildar Khusainov does not rule out that the revival of demand stimulates sellers to slightly raise prices. But for now, this policy is offset by the discounts provided: the average discount in the market is 5.1%, he says. The most important factor that will influence pricing in the future, Mr. Khusainov considers the Central Bank’s decision on the key rate. “Increasing it will reduce the availability of mortgages and lead to stagnation in demand, while a decrease may lead to more active growth in demand and warming up prices,” he explains.

Alexandra Mertsalova