The impact of the coronavirus pandemic on the Russian real estate market

Abstract

Special attention in the crisis year of 2020 was focused on the real estate market in Russia. An amazing feature of the Russian real estate market is its sharp growth during the crisis period. Residential real estate for many Russians of the Soviet mentality is still a hedge against the risk of losses associated with the possible weakening of the national currency and due to the crisis reasons. Such dynamics can be traced by the growth of prices per square meter in the crisis periods of 1998 and 2008. The crisis of 2020 was no exception. In just 10 months of 2020, Russians were issued mortgages for 375 billion rubles. Only in August 2020, the number of mortgage loans issued amounted to 148 thousand, which is 38% more than the same indicator for 2019. Another important reason that had an impact on the Russian real estate market was the introduction of a program of state support for mortgages. The mortgage program also stimulated an increase in the volume of demand in the market and, accordingly, an increase in prices. Surprisingly, in some regions, real estate prices have increased by more than 25% since the beginning of the pandemic. © 2022 Author(s).