From January to December 2021, the number of real estate transactions in Moscow, considering upper class property only, increased by 24% compared to the same period of the previous year.
About 17% of all transactions were signed for deluxe property at an average price of 211 million RUB per lot. Number of these transactions increased by 34% year-on-year. Meanwhile, the lions share of 83% has been secured by premium real estate (up by 22% 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 1,300 lots for sale (down by 39% compared to a year ago), with 415 lots of the deluxe class (down by 14%) and 885 lots of premium level (down by 46%). The total footage of all those lots available amounted to 189 thousand square meters (down by 29%). This is the lowest supply total available since 2015.
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.