Peak in housing prices is over, experts say

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Market this autumn has once again confirmed the desire of most buyers tend to purchase housing to pre-New Year rush. Because of this, those who do not find an apartment in August, the end of October have to add to the budget deal at least 10%. However, realtors believe that in November prices should slow somewhat, “Vedomosti”.

Constantine April, President SAVA real estate, explains 6-percent increase in prices in the last month in the early fall of traditional seasonal fluctuations in supply prices. True, in 2001 and 2002, prices began to seasonal increase in September and October, in 2003, prices began to rise in August. Many buyers were set to play the lead and bought housing before autumn peak prices, but ahead of experienced realtors, we expose new price tags, have a few. Those who made a deal in August, but not in October, have won at least 10%.

In October, the cost of housing has increased by 4.3%, reaching in 1330 dollars for 1 sq. m. m vs. 1275 in September. In November, the index reached 1398 dollars. The head of the center, a certified real estate market analyst Oleg Repchenko, in recent months has created a significant advantage in market demand second homes on the existing proposal. The main reason for the imbalance was the weakening of the dollar, resulting in large numbers of people hastened to transfer savings from the U.S. currency in the square footage.

According to specialists of “Domostroy”, in 2003, increased the burden on the most expensive segment of the housing, which is due to the almost complete end of the year at the beginning of construction of two major areas – Mariynskoe Park and Southern Butovo. “With another round of reduction in supply of affordable housing in new buildings greatly increased pressure of demand for apartments segment with low consumer characteristics of the secondary market, which began in 2001, – the press-secretary of the” patriarchal despotism “Catherine Dushkin. – However, this category of secondary residences may provide all of the demand, which leads to a significant increase in prices and the migration of unrealized demand in the suburbs. ”

The decrease in supply realtors recorded in the segment mid-market real estate. Because of this, the demand for super-elite property – class de luxe, cost from 4,500 to 11,000 dollars for 1 sq. m. m, the experts noticed a change motivated acquisitions of real estate. “Previously these apartments are purchased for subsequent lease and yield of 3-6% was higher than the bank deposits – said Chaplin – now the likely reason for the increase in demand for such apartments – the situation on the domestic stock market, with Property which is regarded more as an effective and reliable financial instrument investment capital. ”

Now, even if the supply and demand equilibrium is reached, it is likely to lead only to a slowdown in growth, and not to lower prices, experts say. They forecast continued growth in prices in 2004.