High mortgage rates warm up rental market

The cost of renting housing has increased by 20% over the year in Kazan

High mortgage rates warm up rental market
Photo: collage by realnoevremya.ru

Prices for rental housing have risen sharply in the capital of Tatarstan. The market is under pressure from the unaffordable mortgage rate for many on the secondary market and the seasonal demand for daily rent from tourists. What percentage of the salary a teacher, a welder, an accountant and a trucker are forced to spend on renting a one-bedroom apartment in Kazan today, what will happen to rental rates in 2024, and whether there is investment potential in this market — in the review of the analytical service of Realnoe Vremya.

According to calculations by Avito Real Estate, the volume of supply of apartments for long-term rent in Kazan has decreased by 42.4% over the year, while demand has increased by 12.3%. As a result, the average hiring rate in the capital of the republic has increased by 20% over the year — from 25 to 30 thousand rubles. The rent of three-bedroom apartments has risen the most (+27.5%), the rental of studios has risen the least (+15%).

Teachers and lawyers pay more than half of their salaries for rent

Analysts of Avito Real Estate and Avito Jobs jointly studied how much of the salary has to be spent on renting a one-room apartment in million-plus cities by representatives of eight popular professions — a sales consultant, a teacher, an accountant, a lawyer, a courier, a welder, a real estate agent, and a trucker.

On average, in Russia, truckers have the least funds to rent housing. With an average proposed salary of 133 thousand rubles and the cost of renting a “one-bedroom apartment” of 23 thousand rubles, a representative of this profession will have to give 17% of earnings. Also, a relatively small part of the salary will be spent by real estate agents (21%), welders (27%), and couriers (33%). But for lawyers, accountants, teachers and sales consultants, rent will cost more than half of the salary.

In Kazan, a teacher is forced to give 68% of his salary for renting a “one-bedroom”, a lawyer gives a little less — 62% — for rent. The best things are with truckers (they give only 16% of their salary for rent), real estate agents (21%) and welders (32%).

“The most expensive one-room apartment rental among Russian cities with millions of people is in Moscow, St. Petersburg and Yekaterinburg. Moreover, in two capitals, housing rental will take away a larger share of the average salary offered than in other megacities — 59% and 47%, respectively. From the point of view of prices, rental housing is more profitable in Voronezh, Chelyabinsk, Samara and Omsk. In these cities, representatives of eight professions who participated in the study will have to pay on average a little more than a third of the average salary for rent," commented Konstantin Kamenev, the head of the long-term rental category of Avito Real Estate.

Mortgage has become unavailable

“Rent cast has jumped by 20-30% in Kazan. This is due to the situation in sales and mortgages," Marat Gallyamov, the founder and director of Etazhi-Kazan real estate agency confirmed to Realnoe Vremya. “In the secondary market, a mortgage loan is taken on average in the amount of 5.5 million rubles, at today's rates in this case, the payment reaches 70-80 thousand rubles. In the primary market, a loan is usually issued at the maximum available amount of 6 million rubles. Under a family mortgage, the monthly payment reaches 36 thousand, and under a preferential one — 44 thousand rubles.”

Mortgage payment in the secondary market today has become critically higher than the cost of rent. “A year ago, one-room apartments were rented for 20-25 thousand rubles, now for 35-40 thousand rubles," he gives an example.

According to the expert's expectations, the rental market will continue to grow. “There is a shortage of supply in Kazan today, it is very difficult to find an apartment for clients," explained Marat Gallyamov. “The old dilapidated fund is already very reluctanty bought. Everyone wants a freshly renovated apartment, and most importantly, people are willing to pay. Therefore, rent and the business around rent are developing very dynamically.”

The potential of the rental market, according to his estimates, is far from being exhausted. In the next 5-6 years, demand will be at a fairly high level: “Kazan is growing, developing and adding. While mortgage rates will be at the current level, the demand for rent will not decrease. There are not enough apartments on the market.”

Apartment owners lured away by tourists

“The number of offers on the market for long-term rentals has really decreased over the year, and one of the reasons is the transition of owners who rented their apartments for a long time to daily rent. The market is now hotter than ever in demand," Ruslan Khabibrakhmanov, the director of the real estate agency, confirmed.

The increase in demand is connected, among other things, with a decrease in housing affordability — for many, renting an apartment remains the only option.

Not all objects, according to Khabibrakhmanov's forecasts, will return for long-term rent. Those that are in good locations in Vakhitovsky and Novo-Savinovsky districts, with fresh designer repairs, will remain on the daily rental market. “The economy segment is already starting to return, but with higher price tags. And this return will be temporary," he believes.

Next year, due to the increase in the number of tourists and guests of Kazan, even more objects will switch to daily rent, so the demand in the market will only grow.

A surge in sales in the market

“The number of apartments for long-term rent has decreased for several reasons. The first point is that part of the apartments all together have gone into the short-term rent," agrees real estate expert, head of Schastlivyy Dom real estate agency, Anastasia Gizatova. “Secondly, a lot of real estate was sold. Now we are seeing a surge in real estate sales, and a lot of people who used to rent apartments have finally sold them.”

Rent, according to Anastasia, today is an indicator of what is happening in the real estate market. Its growth in 2023 was influenced by inflation, rising utility bills, as well as the growth of monthly mortgage payments.

At the same time, Gizatova is confident that the offer on the rental market will be replenished in the near future due to a new wave of new buildings. “They will be stuck in the sale, and this will be the next stage of market stagnation. A large percentage of such apartments will enter the rental market," she believes.

Yulia Garaeva

Подписывайтесь на телеграм-канал, группу «ВКонтакте» и страницу в «Одноклассниках» «Реального времени». Ежедневные видео на Rutube, «Дзене» и Youtube.

Sports Tatarstan