From January to September 2021, the number of real estate transactions in Moscow, considering upper class property only, increased by 9% compared to the same period of the previous year.
In the Q3 2021, about 22% of all transactions were signed for deluxe property at an average price of 226 million RUB per lot. Number of these transactions increased by 44% year-on-year. Meanwhile, the lions share of 78% has been secured by premium real estate (up by 2% at an annual rate), at an average price of 84 million RUB per lot.
At the end of the reporting period, total supply available in the market reached 1,570 lots for sale (down by 8% compared to a quarter ago), with 440 lots of the deluxe class (up by 30%) and 1,130 lots of premium level (down by 18%). The total footage of all those lots available amounted to 217 thousand square meters (down by 6%). This is the lowest supply total since 2016.
Several factors contributed to the high level of demand for the upper class real estate property in the reporting period. Lowest ever mortgage rates have become a driver, providing a fairly easy entry into mortgage transactions, especially with the premium class property. That is, a larger circle of people can afford the purchase, albeit with the involvement of credit funds. Substantial impact on demand was also exerted by low interest rates on deposits, an alternative to which was investment in high-quality real estate. In addition, a certain number of wealthy people have returned from far abroad countries, and also consider buying new property now.
The demand for upper class real estate property is a key indicator anticipating consumers’ interest for premium and high-end furniture in the area, in short to medium terms. We are tracking this indicator more closely within our extended Market Reports.
