From January to May 2022, the number of housing mortgages issued by leading (top 20) banks in Russia reached 468 thousand. This represents a 36.2% decrease to the same period of the previous year. The total value is estimated at approximately 1.62 billion rubles, down by 24.9% year-on-year.
The decrease in mortgage issuance in May is temporary and is primarily due to a decrease in the number of applications for loans amid high rates in March-April 2022. Taking into account the fact that 1 or 2 months pass between the application for a mortgage and the issuance of a loan, the Russia’s mortgage market may start to recover in July 2022, amid a reduction in rates by 6 percentage points in May compared to April (up to 11%), and from 12% to 9% in May and subsequently to 7% in June under the preferential mortgage program.
The number of households becoming owners of new apartments and houses is a key factor shaping the demand for furniture for all residential areas in the medium term in Russia, as well as partly pent-up demand over a longer time-horizon.
We are tracking this indicator more closely, including the structure of mortgages issued by types of property and housing readiness, within our extended Market Reports.
