1.5

is the minimum number of times by which Russia’s housing market will decline in value terms in 2015.

Despite the efforts of the state and major banks to preserve an acceptable level of mortgage lending, there have been problems with housing construction this year. First, a portion of the population has already solved its demand for housing during a period of feverish demand at the end of last year. Second, many people, especially those with low and middle incomes, have decided to postpone the purchase of goods and durable services, including housing, until ‘better times’ (this transition to a selective savings model of behavior is almost always carried out by households during periods of prolonged decline in real incomes in order to minimize potential losses caused by the situation’s unpredictability). Third, the recently introduced property tax increase, deductions for remodeling for owners, and possible further parliamentary initiatives in this area have served to cast serious doubt on the purchase of property for investment purposes.

These data are presented in a new Monitoring the Business Climate in the Construction Sector study that was conducted in the third quarter of 2015 by the Centre for Business Tendency Studies at the HSE Institute for Statistical Studies and Economics of Knowledge (ISSEK).