On the apartment everyone: Russian economy threatens collapse through a mortgage boom
But the money of the state unexpectedly created a new big problem for the economy of the aggressor - "a fast growing residential bubble," The Wall Street Journal writes. Journalists say that due to the rise in real estate prices and inflation, representatives of the authorities have already quarreled.
But the Kremlin continues to insist that the Central Bank does not refuse to maintain the country's financial stability, while the current authorities continue to invent different ways to enlist the support of the Russians on the eve of the 2024 presidential election. As noted in the publication, the head of the Central Bank of Russia Elvira Nabiullin is already calling for cancellation of some subsidized mortgage programs. It warns that they undermine efforts that should restrain inflation.
But Russian President Vladimir Putin wants to continue by the end of 2024 a popular mortgage program, in which Russians with children have reduced rates on loans. "If the government does not limit the subsidized mortgage programs that are subsidized, the impact of the key rate on the economy will weaken significantly, and therefore we may have to keep the rate high longer," Nabiallina says.
According to WSJ, the Russians were seriously fascinated by the mortgage almost immediately after the start of a full -scale war. It was then that the banks softened lending standards. The mortgage volumes in 2023 increased by 72%, to almost $ 70 billion, and have already set a new annual record. "However, economists warn that high costs and lending have led to alarming signs of economy overheating . . .
The government is faced with increasing costs, compensating to banks with the difference between the market rate on mortgage loans," the publication said. It is noted that for many Russians, real estate investments are one of the few places where you can invest excess cash and provide high inflation protection. But, as Olga Bychkova's economist told journalists, almost half of new borrowers spend 80% of their income or even more on debt service.
At the same time, one of the key groups that uses the mortgage - the families of dead and wounded servicemen. Therefore, if in Moscow decide to reduce the support of such households - there will be a crisis of ownership. By the way, in October, the economic specialist and chairman of the Novaya Country Charitable Foundation Andriy Novak suggested that there was a default in Russia, since the state has no opportunity to fulfill its debt.