The Central Bank last week once again raised the key rate – up to 9.5%. Against this backdrop, mortgage rates are expected to rise to double-digit rates. Gazeta.Ru asked experts whether it is worth buying a home in 2022 or is it better to postpone the purchase for now. And also found out what will happen to apartment prices in the near future.

“The era of high stakes is here to stay.” Should You Get a Mortgage in 2022?

Realiste advised Russians to rent apartments instead of buying

The Central Bank last week once again raised the key rate – up to 9.5%. Against this backdrop, mortgage rates are expected to rise to double-digit rates. Gazeta.Ru asked experts whether it is worth buying a home in 2022 or is it better to postpone the purchase for now. And also found out what will happen to apartment prices in the near future.

In the near future, banks may revise the conditions for mortgage programs due to an increase in the key rate from 8.5% to 9.5%.

So, in Rosbank declared RBC that the market average cost of such loans in the first half of 2022 may approach 10%. Absolut Bank reported that if the key rate reaches 11% in the future, then mortgage rates could rise to 12-13%.

Experts interviewed by Gazeta.Ru also believe that mortgage rates will only grow in the near future.

Now the country has “extremely high” inflation, notes Metrium’s managing partner Nadezhda Korkka: in January it was 8.7% year on year, the highest since February 2016. If the Central Bank continues to raise the key rate, mortgage rates may reach 11-12%.

Alexei Popov, head of Cyan.Analytics, explains that the era of high stakes is for a long time. In his opinion, this is evidenced by the general rhetoric of the Central Bank, and not just another increase in the key rate.

Should You Get a Mortgage in 2022?

If buying a home is relevant for a person now, it’s definitely not worth postponing it, says Nadezhda Korkka from Metrium. According to her, even if this year to take a mortgage at a higher rate, it will still help save money: apartment prices continue to rise. Postponing the deal now, you can miss out on profitable options.

Moreover, if you wait for a reduction in rates, the solution to the housing issue may be delayed indefinitely, says Dmitry Alekseev, head of primary and suburban real estate at Avito Nedvizhimost.

“I think that the Russians will not see the cheap money that could be obtained in 2020-early 2021 for a long time, therefore, if there is a need to improve housing conditions, it should be done now,” also believes a specialist in the banking sector, head of the representative office of the investment Fund ANIF in Russia Sergey Grigoryan.

There is another option: you can pay attention to the lease, points out the founder of the Realiste IT company (developed artificial intelligence for instant real estate valuation) Alexey Galtsev.Against the background of a potential increase in mortgage rates to 11-12% in 2022, housing can be more profitable.

How to buy an apartment more profitable

Now there is still the opportunity to use some preferential programs, Nadezhda Korkka from Metrium recalls. You can also take a closer look at subsidized rates that developers offer together with banks.

It is also likely that subsidizing a mortgage from the state will resume, adds Alexei Popov from Cyan. Analytics. But support will no longer be as massly as in 2015-2016 or in 2020-2021. Those who still plan to postpone the design of the mortgage, need to focus on targeted benefits or take a pause for a year or two, he advises.

It is important to remember that there is the possibility of refinancing: even if you now take a mortgage at a high rate, in the future it can be revised-on more favorable terms, says the director of the Department of Mortgage lending EST-A-TET Alexey Novikov.

What will happen to housing prices

It is not worth expecting a significant decrease in housing prices in the near future: there are simply no prerequisites for this, Alexey Novikov from EST-A-TET pays attention. According to him, prices can only adjust a little due to the growth of mortgage rates.

Now most of the projects are carried out on escrow accounts, and such a business model does not provide for price reduction, the expert adds. The situation in the market does not have this either: inflation is growing, the costs of building materials and the remuneration of workers are increasing.

At the same time, construction can continue to rise in price due to the gap of production and logistics chains in connection with pandemia, Nadezhda Korkka from Metrium notes. And this is reflected in the cost of new buildings. “By the end of 2022, the weighted average cost per square meter can increase by 8-10%,” she said.