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Tuesday, October 25, 2016

Men told whether to take an apartment in the mortgage

The head of the Ministry of construction Mikhail Men reported that the mortgage market this year may approach the record of 2014. Then the Russians have taken housing loans worth 1 trillion. 760 billion rubles. The current trend suggests that in 2016, the mortgage will be issued not less.

photo: Gennady Cherkasov

For the first five months of the current year amount of mortgage loans amounted to more than 550 billion rubles that Is almost 50% ahead of last year’s data, and only 18% lower than two years ago. During the same period, the average rate on mortgage loans has decreased from 14.2% to 12.7%. This includes mortgage and a conventional Bank loan.

According to experts, helps to sell houses to developers today mainly preferential mortgage, when the interest rate on loans does not exceed 12% per annum, and the difference between market rate and concessional banks are compensated by the state. The program is valid until the end of 2016. However, the Executive Director of the Institute for urban Economics Tatyana Polidi believes that it is dangerous to make the mortgage more affordable artificially if there is no effective demand and the necessary macroeconomic conditions. “At current income levels, when people live from paycheck to paycheck, approximately 70% of the population simply does not have the ability to pay the mortgage while still high real estate prices. And in a little predictable and high inflation, the mortgage rate even more risky. This poses a serious threat to the growth of overdue debts”, – says the interlocutor of “MK”.

Where this may lead, in 2008, showed the mortgage crisis in the United States, which quickly turned into a global financial crisis. According to United credit Bureau, since the beginning of the year in Russia the number of mortgage loans with overdue payments rose by 22% and amounted to 103 thousand. The volume of overdue debt on mortgages increased by 17% to 155 billion rubles.

“From officials interested in maintaining the volume of construction, today comes the promise: the price reached the bottom, then get cheaper housing will be gone. I do not agree with this position. Today it is absolutely not clear, how in a few months will cost a barrel of oil and what will happen to the ruble, with inflation. Nobody knows, but the macroeconomic impact is on the incomes and financial markets. Therefore, it cannot be excluded that falling of incomes of the population will continue,” says Polidi. To buy an apartment in the mortgage in such circumstances, expert advice is only if we are talking about a single housing and the borrower are confident enough in their income at least for the next five years.

However, the Ministry of construction in doubt that the mentality of Russians is “ripe” for development of alternative market – rental housing. “The legal framework prepared whole, there are initiatives in terms of taxation. About one million square meters of rental housing in the country is already built. But it is unclear whether “fly” this market we have or not,” announced his position, Mikhail Men. Rental housing involves the construction of a so-called “apartment houses”, where all the apartments are for long term renting. The Minister recalled that this sector operates successfully in Europe, but is less developed in the United States.

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