Mortgages remain expensive, buyers have become more cautious, and developers are thinking twice before launching new projects. Yet housing prices are showing little inclination to fall.
In fact, existing homes have recently been appreciating faster than new-build properties. At the same time, the government is allocating another RUB 157 billion to subsidized mortgage programs, while investment capital is shifting from commercial real estate toward residential property.
Russian Estate examines the key developments of the week and what they tell us about where Russia’s real estate market is heading.
The Russian property market has reached an unusual point.
Mortgages are expensive. Buyers are scrutinizing their finances more carefully. Developers can no longer assume that almost any new supply brought to market will quickly find buyers. Investors, meanwhile, are demanding higher returns from commercial properties.
Logically, the next part of the equation should be falling prices.
So far, that is not happening.
Instead, existing homes are appreciating faster than new builds, the government is committing billions of additional rubles to mortgage support, developers are becoming more cautious about new supply, and investors are reducing their exposure to commercial real estate while increasing allocations to residential property.
At first glance, these may look like separate stories.
In reality, they are telling the same story.
Russia’s real estate market is learning to live without cheap money.
And judging by this week’s numbers, the learning process has only just begun.
One of the most interesting signals this week came from the existing-home market.
In August, the average price per square meter on Russia’s secondary housing market rose by 1.3% month on month to RUB 130,100.
Prices in the new-build market increased by only 0.7% over the same period, reaching RUB 192,800 per square meter.
The difference is also visible year on year: existing homes appreciated by 11.4%, compared with 9.5% for new builds.
And this is no longer a one-month anomaly. Prices on the secondary market have now risen by at least 1% per month for four consecutive months.
There is another noteworthy figure.
The average price per square meter in relatively recent buildings — those completed no more than ten years ago — has reached approximately RUB 194,200.
That is already slightly above the average price per square meter in the new-build market.
This creates an interesting situation: relatively modern existing homes are beginning to compete with new developments not only on convenience, but also on price.
Why is this happening?
For several years, Russia’s new-build market operated in a very particular mortgage environment. Government-backed programs allowed buyers to finance newly built apartments at interest rates significantly below those available under conventional market mortgages.
As a result, buyers were often choosing not the apartment that was objectively cheaper, but the apartment for which financing was cheaper.
Now buyers are once again calculating the full cost of ownership.
And this is where existing homes regain some of their advantages.
The keys are available immediately. The building already exists. The neighborhood exists outside the glossy pages of a sales brochure. Buyers can see the condition of the apartment and the common areas with their own eyes.
Sometimes they can even see the neighbors in advance. In real estate, that is practically an additional layer of due diligence.
There is another advantage: negotiation.
The difference between the asking price and the actual transaction price on the secondary market can be significant. That means headline price-per-square-meter statistics do not always tell buyers the whole story.
Rising prices for existing homes do not yet mean buyers are returning to the secondary market en masse.
The main obstacle has not disappeared: conventional mortgage rates remain high.
But the long-standing advantage enjoyed by new developments because of subsidized mortgage programs is becoming less absolute.
That is already a significant change.
This week, the Russian government announced additional funding for subsidized mortgage programs.
The total amount is RUB 157 billion.
It is important to understand what this number actually means.
RUB 157 billion is not fresh money that will suddenly appear in homebuyers’ pockets tomorrow.
A substantial part of the funding is required to compensate banks for the difference between the subsidized interest rate paid by borrowers and the actual cost of financing.
But that is precisely why the scale of the figure is so revealing.
It demonstrates just how dependent Russia’s new-build market has become on the government-backed mortgage system.
The latest available data from the Bank of Russia adds another important piece to the picture.
In July, Russian banks issued 85,500 residential mortgage loans worth RUB 363.4 billion.
Of that amount, RUB 188.2 billion — 51.8% of total mortgage lending by value — was issued through government-supported programs.
In other words, more than half of all mortgage money in the country was being lent with some form of state support.
This may be one of the most important figures for understanding Russia’s housing market today.
When conventional mortgages become too expensive for a large share of buyers, the Family Mortgage and other subsidized programs stop being merely instruments of social policy.
They become mechanisms that directly shape demand for new housing.
For developers, this creates substantial dependence on government decisions.
That is why decisions concerning subsidized mortgages can now matter almost as much to the real estate market as changes in the central bank’s key interest rate.
When market mortgage rates are high, the mathematics of buying a home becomes unforgiving.
In these conditions, a mortgage calculator can sometimes be more persuasive than any property consultant: enter a few numbers and buyers quickly discover just how badly they really want that particular apartment.
This changes buyer behavior.
People take longer to make decisions. They compare new builds with existing homes more carefully. Where possible, they increase their down payment. They consider smaller apartments or locations farther from the city center.
Some postpone the purchase altogether.
As a result, the market is gradually shifting from competition among developers for the largest possible number of buyers to competition for buyers who can actually afford to complete the transaction.
That is a very different kind of market.
Not necessarily.
And this is where one of the central paradoxes of Russia’s 2026 property market emerges.
When demand weakens, a buyer’s first thought is understandable: developers will have to cut prices.
But developers have another option.
They can build less.
Land costs money. Construction materials cost money. Labor costs money. Project financing certainly costs money.
If buyers are in no hurry to visit sales offices, bringing several thousand additional apartments to market in the hope that somebody will eventually need them is a rather expensive way to remain optimistic.
Developers can therefore respond to weaker demand not by directly cutting the price per square meter, but by reducing new launches.
For buyers, this creates an uncomfortable paradox.
Weak demand does not automatically guarantee cheaper housing.
If supply contracts alongside demand, the market can find a new equilibrium without any dramatic decline in prices.
That is why the simple equation — “mortgages are expensive, therefore apartments will soon become cheaper” — may not work.
Real estate has never been particularly fond of simple scenarios.
The price per square meter is only the visible tip of a much larger iceberg.
Below it are the cost of land, construction, infrastructure connections, building materials, equipment, labor and borrowed capital.
That gives developers considerable room to avoid cutting headline prices directly.
Only after those options have been exhausted does a substantial reduction in the official price become the central question.
As a result, a housing-market correction can occur not through falling prices per square meter, but through fewer transactions and lower volumes of new construction.
For buyers, the distinction is fundamental.
Waiting for better purchasing conditions and waiting for a housing-price collapse are not the same thing.
A similar adjustment is taking place in Russia’s real estate investment market.
According to preliminary estimates, total investment in Russian property over the first nine months of 2026 is expected to reach approximately RUB 600 billion, compared with RUB 679 billion a year earlier.
That represents a decline of roughly 12%.
But the movement beneath the headline figure is considerably more interesting.
At first glance, it may appear that capital is simply leaving the real estate market.
That is only half the story.
While investment in commercial property is declining, investment in residential real estate has increased by approximately 45% to RUB 178.6 billion.
Residential property’s share of total real estate investment is approaching 30%.
In other words, investors are not necessarily abandoning property.
They are reallocating capital within the sector.
And this may be one of the most interesting signals of the week.
Expensive money forces investors to compare risk and potential returns much more carefully.
The argument that “it’s real estate” is no longer enough.
An asset must explain how much income it can generate, how reliable its tenants are, how easily it can eventually be sold and whether there is meaningful potential for capital appreciation.
The bank deposit.
Of course, bank deposits and real estate cannot be compared directly. They are fundamentally different instruments with different levels of liquidity, risk, investment horizons and potential for capital appreciation.
Investors compare returns nonetheless.
If a relatively simple financial instrument can offer a high yield, commercial property has to provide a convincing premium for lower liquidity and the operational burden of managing a physical asset.
That means the quality of the underlying property matters again.
A well-located office with a reliable tenant and a long-term lease is one investment.
A vacant property with a beautiful presentation deck is another.
The market is beginning to recognize the difference again.
Put the developments of the past several days together, and four major processes become visible.
All four developments have one underlying cause.
Money has become expensive.
It is certainly possible to try to predict the exact price per square meter on December 31.
There are, however, more useful ways to understand the market.
Through the end of the year, Russian Estate will be watching five indicators particularly closely.
Russia’s real estate market can no longer be described with a single word such as “growth” or “decline.”
It is becoming more complex.
A new-build buyer depends on the mortgage program available to them. A buyer on the secondary market is trying to find a balance between the price of the property and the cost of financing. A developer is calculating whether the next project should be launched at all. An investor is comparing real estate with alternative places to put capital.
Only a few years ago, much of this worked according to a relatively simple chain: cheap money supported mortgages, mortgages supported demand, and demand allowed construction volumes and prices to rise.
Now everyone has to do the math again.
And when every participant in the market starts calculating at the same time, real estate becomes considerably more interesting.
Russian Estate | Real Estate Week
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