What Will Happen To Apartment Prices In Belarus By The Fall?

Expert Prediction.

The residential real estate market can be characterized as hot right now. Buying activity is kept on still available loans and the reduced dollar exchange rate. But against the background of continuing price growth, the limit of purchasing power is already on the horizon, and it will soon "bump into the ceiling". About the situation on the market MyFin.by talked to the deputy head of the consulting and analytics department of the group of companies "Your Capital" Andrei Chernyshev.

What is the demand?

The demand on the primary and secondary market is now high. In the primary market apartments are frankly lacking, which is taken advantage of by developers and try to raise prices as much as possible.

- Now it is difficult to find an apartment on your own. This year we have seen an increase in the flow of buyers, many apartments are leaving without even being advertised. In April, 43% of apartments in our agency were sold in the first two weeks. 2700 buyers in the demand base are waiting for apartments to come on the market. The market is very hot.

Dollar down, and prices?

The decline in the dollar leads to the fact that in translation into Belarusian rubles the cost of apartments is reduced. All this allows to compensate for the growth of housing prices in dollars and the growth of loan rates for buyers.

Transactions less?

At the end of April, about 1300 transactions on the transfer of ownership in the secondary market and in ready-made new buildings are expected. Is it a lot or a little? Compared to last year - a significant decrease. In April last year at the peak of activity was more than 2000, the average for the month - 1650.

- There is not enough supply, prices are rising, loans are becoming more expensive. This affects demand. Yes, people are buying, but buyers have hit the ceiling in terms of their financial capabilities. We warned the sellers about it.

In the mortgage sector of our agency, we calculate loans for buyers. And they start to worry when they see the amounts they have to pay monthly for the loan and the interest on it. And the loan amounts themselves are growing. For example, exactly a year ago, the average size of a loan to buy an apartment in the secondary market was Br113 thousand, while today - Br131 thousand. And if divided into years and months, the loan payments will be quite impressive.

According to Andrei Chernyshev, the best time for sales was last fall - the prices were a bit lower, but the buyers were more solvent. Since the beginning of the current year prices have been growing a little bit, but for the most well-maintained apartments, with repair, with the possibility to move in and live at once, without thinking about how much more to invest in repairs.

40% of buyers in the secondary market take out loans, and they have to spend them also on repairs. That is why transaction prices for "tired" and requiring significant repair of apartments already show a slight minus.

- If buyers are looking for apartments up to 50 thousand dollars in equivalent, then in February and March there were no such apartments. And now sellers of very "tired" apartments began to realize that it is necessary to adequately evaluate them, and they began to appear on the market. But such apartments are sold, often without being advertised.

Old Fund

- There is also a new trend regarding the attractiveness of apartments in the city center. It was thought to be profitable to buy apartments near Komarovsky market, Maksim Bogdanovicha Street, where the old stock is quite old. Now the average age of buyers has decreased. And even if the apartment is registered on parents, it will serve young people in the future, and they choose it according to other criteria. They are more interested in apartments in a more modern house. For example, in "Minsk Mira", in the area of "Grushevka", "Petrovshchina" and other young complexes of the city.

The supply is narrowing, and prices have increased more than in the secondary market. If for the last 12 months on the secondary market increased by 15%, in new buildings by more than 20%.

- We used to say that if the supply on the primary market decreased, buyers started to look at the secondary market. Now, when apartments on the "secondary market" became unreasonably expensive, the opposite trend has emerged - buyers reason "I'd better add and buy a really new home".

Prices will grow until summer

According to the expert, if the dollar rate stabilizes at the current level and will not grow, credit conditions will not change, prices will move up until summer. But at the same time against the background of already high prices, the number of transactions may decrease.

- The real estate market is inert, it does not immediately respond to any collapse or growth. And what we predicted and talked about in the fall, is now beginning to manifest itself in practice. Today sellers should take into account that the faster you sell an apartment, the more favorable its price will be. The rule of thumb for selling is to make it before the end of summer, because there will be less and less effective demand. The earlier you sell, the less you will have to discount later.

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