Irkutsk
Ulan-Ude

Blagoveshchensk
Chita
Yakutsk

Birobidzhan
Vladivostok
Khabarovsk

Magadan
Yuzhno-Sakhalinsk

Anadyr
Petropavlovsk-
Kamchatsky
Moscow

This text is translated into Russian by google automatic human level neural machine.
EastRussia is not responsible for any mistakes in the translated text. Sorry for the inconvinience.
Please refer to the text in Russian as a source.

VTB: rental housing becomes more expensive than mortgages

VTB: rental housing becomes more expensive than mortgages
Photo: pixabay.com

VTB issued a record amount of mortgages in 2020 and lowered loan rates. The bank's clients were able to reduce their loan service by 25%.

According to the press service of VTB, according to the calculations of the company "Square Meter" the monthly payment of interest on mortgages for an average Moscow apartment has decreased by an average of a quarter. Thus, mortgages have become more profitable than renting comparable housing.

Due to the pandemic, several changes occurred on the rental market at once. In particular, due to the outflow of students and foreigners, demand has decreased. This was also influenced by the decrease in tourist activity of the population. Hotels, in turn, also experienced the adverse effects of the pandemic and began renting out rooms at the price of rented apartments.

At the same time, housing rental prices have not changed. The cost of one-room and two-room apartments has decreased by only 3-5%. Landlords often chose to give up looking for clients instead of lowering prices.

Against this background, mortgage prices fell. Average rates on home loans fell from 9,9% in 2019 to 7,8% in 2020. Loan refinancing showed record growth. As a result, according to VTB data, the level of monthly payments to borrowers' income decreased from 30% to 25%.

According to Anatoly Pechatnikov, Deputy President and Chairman of VTB Management Board, the housing market in Moscow is highly heterogeneous. In this regard, for a number of programs, servicing mortgage interest has become much more profitable than rent. Yes, the cost of the first installment, insurance, registration of an object is much higher than rental payments, adds Anatoly Pechatnikov. But paying off the principal is an investment in the future.

October 23: current information on coronavirus in the Far East
Digest of regional events and latest statistics