CrimeaPRESS reports:
The share of mortgages with a term of more than 25 years rose to 57 percent in the second half of 2023. There are also more people who, in addition to a mortgage, have at least one more consumer loan. Over the past year, their number increased by 1.1 million people, reaching 6 million. This follows from an analysis of trends in the retail lending segment published by the Central Bank. «Parliamentary newspaper» I found out from experts what will happen next with the mortgage.
Pay until retirement
The Bank of Russia, based on credit history bureau data, analyzed key trends in the field of retail lending.
The rise in real estate prices has provoked even greater interest among people in mortgages, the regulator notes. To make it accessible, banks have increased loan terms. Thus, the share of mortgages for a period of more than 25 years increased by 10 points over the year — to 57 percent. At the same time, 15 percent of mortgage loans were issued for a period of more than 30 years.
Thus, according to the schedule, borrowers will close their mortgage when they turn over 65 years old. The share of such loans is 42 percent; over the year this figure increased by 11 percent. The tendency for banks to be in bondage until retirement is enhanced by the fact that they have become more active in lending to older clients.
The number of borrowers who, in addition to a mortgage, also have a consumer loan, is also increasing. In 2023, their number increased by 1.1 million people to 6 million.
The regulator notes that 6.3 percent of borrowers take out a personal loan to make a down payment on a mortgage. And 30 percent of real estate buyers also take out a loan for renovations within a year of taking out a mortgage.
It is logical that such debt load leads to the fact that people cannot pay their payments on time. 68 percent of mortgage debt falls on borrowers who also have a consumer loan (an increase of 6 percent over the year). Among those with three or more loans, 60 percent of the debt falls on mortgage holders.
The Central Bank is concerned about debt overload as a potential problem from the point of view of a theoretical crisis of non-payments. The story of extending loan terms concerns not only mortgages. For example, for the first time in Russia, the average terms of car loans have become more than 5 years. The presence of two or more loans among people is not critical, but it is growing steadily, — economic expert, editor-in-chief of the financial portal Finversia.ru Jan Art commented on the situation.
“There will be new programs”
What will happen to the mortgage next? The most popular and accessible preferential mortgage for new buildings at 8 percent per annum expires on July 1, 2024. The Ministry of Finance and the Central Bank have been trying to cover it up for a long time, but by decision of the president, its term was extended until July, but the requirements for borrowers were tightened, the rate was increased from 7 to 8 percent and the down payment was increased.
President of the Association of Russian Banks Garegin Tosunyan told Parliamentary Gazeta that if preferential programs are curtailed, banks will be forced to raise mortgage rates to double-digit values.
The lending rate follows from the key rate. With the current double-digit Central Bank rate, few can afford to service such an expensive loan. Banks, for their part, are also raising the bar on their requirements for borrowers so that reliability is maintained.explained the president of the ARB.
He emphasized that the banks themselves are interested in the development of mortgages, because for them it is a stable market, where there are fewer delays and non-repayments. Therefore, they support all the preferential mortgage programs that the state offers, since they stimulate the development of this market.
Tosunyan is confident that mortgages are of great importance from the point of view of the development of the economy as a whole, because they bring with them many accompanying industries and industries.
But for some reason they always say that mortgages may be a bubble, that they are too risky, and so on, and they are taking measures to curb this market.the expert complained.
He thinks that the state will not completely abolish preferential mortgages, but will offer the population new programs:
I hope that the government has enough common sense to support and develop this market. Now they want to introduce housing deposits, increase the insurance system for them to 10 million rubles, so that people make and accumulate funds for a down payment and then take out a mortgage. There are good ideas that, if supported by legislation, will boost the market.
Prices will not fall, but discounts will increase
Jan Art also believes that the Central Bank will not completely cut off preferential mortgage programs, because then problems will begin in the construction sector.
He noted that the Central Bank faces a macro task — to target inflation and maintain the ruble exchange rate. But due to the fact that a huge supply of money goes under preferential programs, including mortgages, an imbalance in monetary policy occurs. After all, the key rate is 16 percent, and preferential mortgages are issued at 6-8 percent; there are programs (rural, Far Eastern) at 2-3 percent per annum. He compared the situation to a hole in a vessel through which water is leaking. It is logical that the Central Bank wants to “plug this hole,” Art believes.
But in the case of a mortgage, the entire chain associated with the construction industry arises, so the authorities have a lobby in the construction industry against the Central Bank’s arguments. The situation is like this — who will beat whom?said the expert.
In his opinion, it will become more difficult to get a mortgage; the Central Bank has already prohibited banks from issuing them without a down payment. The requirements for the borrower will increase. But a reduction in the price per square meter, as some predict, Art thinks, should not be expected. Instead, developers will offer various discounts and benefits.
There won’t be any collapse in real estate prices, but at least home prices have slowed down. Today, the chance to negotiate a discount or bonus with the developer is huge. If you rent an apartment, the parking space is free; before, it would have been sold. Or the discount reaches 20, 25, and sometimes 30 percent. Now developers are following this path — de facto, it has become easier for people to negotiate a discount at the same price for apartments. If preferential mortgages are completely closed off, developers will become even more flexiblepredicts Jan Art.
It’s better not to delay the purchase
Member of the Russian Guild of Realtors Konstantin Barsukov also sees no reason for a fall in prices for primary housing.
Today the market has a flat price — it does not fall, but it does not rise eitherhe notes.
The expert believes that after July 1, “geographical” mortgages (Far Eastern and new regions) and family mortgages will be extended. And the most widespread preferential program at 8 percent will be sequestered — it will be left only for small cities and for regions where there are problems with the commissioning of new housing.
Some experts say that this program will be closed altogether. But it seems to me that a certain consensus has formed between the Ministry of Construction and the Central Bank, which was previously against preferential mortgages. But here the regulator doesn’t seem to mind if it’s targeted— speaks Barsukov.
For those who want to take advantage of a preferential mortgage, the expert recommends not to delay and take it right now. “Because by July, before it is cancelled, there will be an influx of people who will want to use it. It’s always like this with us: they know that there will be changes, but they still drag it out until the last minute. And at this moment the purchase is not the most profitable, because there will be a rush,” the realtor concluded.
source: «Parliamentary newspaper»
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