Expert: real estate prices in Moscow will not grow in the next 10-20 years

© Fotolia / vvoeЗакат over Moscow. Archival photoExpert: real estate prices in Moscow will not grow in the next 10-20 years© Fotolia / vvoe

Real estate prices in Moscow will not grow in the next 10-20 years, according to the company «Inkom-real Estate».

«Speaking about prospects of development of the Metropolitan real estate market, we can say that in the future (at least in the next 10-20 years), housing prices in Moscow – as well as the price of oil will not grow thanks to the new balance of power» — presented in a press release the words Director of the Department of the secondary market of the company Sergey Shloma.

According to him, the secondary real estate market «missed» the strengthening of its competitor – the segment of new buildings, in recent times, who for a considerable part of the consumer demand.

«New construction splash the market for a new home in a great volume: in the past year on the primary market of the capital was introduced record number of new square meters. Including at reasonable prices….Therefore, the main technology of the secondary market of real estate in this fight the decline in prices», — stated in the materials.

According to Shlomo, the secondary segment in contrast to the primary is not limited by the threshold of profitability and the cost of the «production» of housing in this conventional zero. «Last year, we noted that for the first time in modern history of the real estate market in Moscow the prices of some objects of the secondary market approached the value of apartments in new buildings (which on average are usually 20-30% cheaper), and in some cases dropped even lower,» he says.

In his opinion, now the primary real estate market appeared oversupply, and because of this, many construction projects are either frozen, or the construction of new facilities is generally delayed. And if earlier the developers planned to introduce a certain amount of housing, say, for 5 years, now they shift the terms and say about 7 or 10 years.

«By the time when the real estate market reaches a price «floor» – according to our forecasts, this will happen in two years, in 2019, the volume of housing on the primary market of Moscow will be significantly lower than it is now. However, if the sellers of secondary habitation in this time will try to significantly raise the price of their property, the developers again come to market with a cheaper alternative options,» — are reported words of an expert.