Off-plan property mortgage issue in Tatarstan falls almost twofold in Q1
2,921 mortgages were issued for off-plan property in Tatarstan from January to March 2023. It is 46% less than during the same period last year, the Institute of Construction Development calculated on the basis of the Bank of Russia’s data.
542 mortgages for off-plan property were taken out in January in Tatarstan this year, 958 — were in February. Their number in March reached 1,421, which is 45.4% less than during the same month in 2022.
Off-plan property mortgages in Tatarstan in the first quarter of 2023 was 14.3 billion rubles. Compared to last January-March, it reduced by 22.9%.
Mortgages granted for off-plan property development in Tatarstan in March is assessed at 7 billion rubles. It is 17.3% less than in the first spring month of 2022.
It should be reminded that since 1 March the Bank of Russia has increased the risk-benefit ratio for mortgages taken out for off-plan property construction. The measure is aimed to restrict borrowers and banks’ risks.
The uplifts include the surcharge of flat prices in the new housing market if the buyer uses a mortgage. This should allow banks to accumulate capital buffers to cover risks due to the price difference in the new and existing housing markets. They became an addition to increased reserves for loans with extremely low rates that compensate for banks’ interest risks.