Construction in Ekaterinburg surpasses Krasnodar in the rate of new residential property development.
In the ever-evolving landscape of Russian housing construction, a complex picture emerges, with growth, regional disparities, and unique challenges shaping the market.
Nationwide Trends
Last year, the volume of individual residential buildings completed in Russia increased by 13%, reaching 488,000 units. This growth, driven by expanded mortgage programs and preferential loans for individual housing construction, has seen a 64% increase since 2020 [1]. Despite challenges such as the end of subsidised mortgage programs and high mortgage rates, housing prices nationwide rose by 6-9% in early 2025, with Moscow experiencing over 12% growth. However, overall housing construction fell by 2.4% in the first half of 2025, due to a mismatch between supply and demand in regional markets [2].
The price difference between new constructions and secondary market housing remains significant, with new construction averaging 55-60% more expensive nationally. This disparity is largely due to preferential mortgage lending favouring new construction, increased construction costs, and quality differences [3].
Yekaterinburg
Despite limited recent data, Yekaterinburg, a city with over 1 million inhabitants, has seen a sharp increase in housing supply. However, demand has declined substantially, leading to a rise in unsold housing inventory outside capital regions. Given national trends, Yekaterinburg is likely experiencing pressure from increased supply and reduced demand, contributing to greater housing availability but also market imbalances [2].
Moscow
Moscow remains a stronghold in housing construction and market performance. Despite a cooling of sales by 20-50% across most regional markets, Moscow's housing market prices rose by over 12% in early 2025, with supply in under-construction residential buildings decreasing by 5-6%, suggesting a better market balance. Mortgage arrears in Moscow increased moderately, reflecting relatively stable buyer conditions despite high interest rates [4].
Krasnodar Region
The Krasnodar region faces significant mortgage debt challenges, with overdue new housing mortgages rising 56% to ₽2.3 billion by mid-2025. This dramatic increase signals greater financial strain on buyers in the region, despite its active new housing construction [4]. Higher mortgage debt growth may be linked to rapid construction expansions encouraging buyers who later struggled with high interest repayment costs, making the Krasnodar market more vulnerable to corrections or increased default risk.
Summary
Russia’s housing construction landscape reflects economic, financial, and policy influences on construction and housing market dynamics. Today, almost as much housing is being built in Yekaterinburg as in St. Petersburg. The Ural market continued to grow rapidly in terms of supply even after the preferential mortgage was canceled. Yekaterinburg currently has a larger volume of housing under construction compared to Krasnodar.
Some decentralization has begun in the housing construction market over the past two years, with Moscow developers buying land banks in the regions. In 2024, there was a 25% decrease in the number of registered transactions in the primary market, indicating a slowdown in construction. Prices are being cut in regions with high unsold housing ratios to maintain profitability.
Regional developers have been buying land banks in Moscow, and there is increased housing demand in the Caucasus due to new funds. Analysts discussed housing construction in different regions at the Domclick Digital Day conference. Additionally, mortgages for SVO participants might be available. Around 1,500-1,900 apartments are sold monthly during the construction phase in Yekaterinburg.
This complex housing landscape underscores the need for careful analysis and strategic decision-making in the Russian housing market.
[1] Russian Housing Construction Increases by 13% in 2024
[2] Housing Construction Fell by 2.4% in the First Half of 2025
[3] Price Difference Between New and Secondary Market Housing in Russia
[4] Mortgage Arrears in Moscow and Krasnodar Regions
[5] Key Developers in Moscow
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