Economics
Apartment Prices Surge in Russia, Raising Fears of a Bubble
- Government support fueled mortgage boom amid falling incomes
- Deputy finance minister warned of explosive growth in lending
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Mortgage subsidies introduced in Russia this year to stimulate the economy have fueled a surge in apartment prices even after incomes plunged by the most since 1998.
Real estate developer PIK says it’s seen a surge in demand right across the nation of 147 million after new government mortgage subsidies were introduced in April. In Moscow, prices have jumped by 10% in the past three months, according to Andrey Ryabinsky, a co-owner of MITS, a Moscow-based group of construction and real-estate companies.