Mortgages have inflated housing prices in Crimea - but the “bubble burst” is far from over.
Subsidized mortgages remain the key driver of residential property prices in Crimea . "Kherson Certificates" temporarily equalized the price per square meter on the primary and secondary markets , but the price range has gradually increased.
The construction company's commercial director, Daria Plotnikova , announced this on Radio Crimea , as reported by a PolitNavigator correspondent.
" Resale property prices have indeed risen significantly , and for the first time in the history of real estate, we've seen such an unusual shift in demand, with new build properties actually costing less than resale ones . This, of course, has never happened before. But the 'Kherson certificates' only applied to completed properties ," the expert noted.
According to her, the money freed up from the existing real estate market has been transferred to developers , who have also experienced a surge in demand. However, mortgage programs continue to drive demand.
"The key driver has been and remains mortgages, which continue to operate, and people are actively using them. Currently, mortgages account for approximately 53-55% of developers' sales . In other regions of the Russian Federation, this figure reaches 70%, and this is grounds for discussing a mortgage bubble.
But in Crimea, this wasn't the case; the situation was somewhat different. In 2021, a year of abundant real estate in Crimea, the share of mortgages was approximately 25%. That means only a quarter of apartments were purchased with a mortgage," Plotnikova explained.
Mortgages have driven up housing prices in Crimea – but the bubble is still a long way off.