Why there will not be a sharp rise in prices
After the approval of the criteria allowing developers to sell the objects under construction according to the old rules (30% of readiness and 10% of the sold areas), it turned out that in the capital about 70% of new buildings fall under the exception. This means that developers will not have to attract project financing and change the financial model of the projects started, laying additional costs for servicing loans.
However, the scheme of implementation of 30% of construction projects and new projects that have not yet entered the market will change. By the way, the number of new buildings that will be sold using escrow accounts can significantly increase if buyers consider the new scheme an important competitive advantage, and developers will be forced to extend the new rules to residential complexes in the high stage of construction readiness.
In such a situation, it is logical to expect higher prices, but due to the continued high competition with relatively low dynamics of housing demand growth will be smooth and moderate. Despite the increase in the cost of construction, developers will not raise prices in proportion to emerging costs. Perhaps only the most successful residential complexes with high sales rates can affect a noticeable increase.
What other factors affect pricing
Most developers in marketable projects located in a successful location, adjust the cost per square meter on a monthly basis. This increase in prices is due to changes in the stage of construction readiness of the object and does not depend on the entry into force of amendments to the legislation.
There is also a market price increase, which is associated with macroeconomic indicators. Thus, at the end of this year, the Central Bank predicts inflation at the level of 4.7-5.2%. The situation is aggravated by the increase in the VAT rate to 20%, which has already provoked an increase in prices for most goods and services, including the construction sector. Construction and finishing materials, fittings, equipment and components have risen in price. The cumulative effect of the rise in the cost of key positions increased the cost of construction projects by 2-3%.
How will prices rise before the end of the year
We should not expect an abrupt increase in prices, timed precisely to legislative innovations. However, the change in the scheme of implementation of new buildings and the need to attract bank project financing determinately affect the average market performance for the year in favor of growth. If the current macroeconomic situation is maintained without the possible tightening of sanctions by the United States, by the end of the year prices in the primary market may increase by 10-15%.
In new projects, more replacement growth is possible – by 15-20% compared to the initial prices in the facilities where sales started before the adoption of amendments. An even greater increase in prices, which would allow developers to compensate for the increase in costs, is hardly possible, as before it will be restrained by effective demand. However, the emerging decline in mortgage rates gives reason to hope for the activation of deferred demand among customers who expect to improve lending conditions.