After a slow couple of years for the building sector in Russia, signs of growth for the industry are once again being seen.
In 2017, while Russia’s construction output fell 1.4% year on year, it saw a growth in value of 4.7% from €102bn to €107bn.
Projections are optimistic for 2018 and beyond.
As the rouble stabilises, a small recovery for the building sector is predicted over the next two years, mainly due to large-scale projects in the civil engineering sector, according to the EECFA (Eastern European Construction Forecasting Association).
Housing construction in Russia
Having shown a slight contraction in 2017, new housing construction is expected to rise again in 2018.
After a record breaking 85.3m sqm of new housing built in 2015, the housebuilding sector in Russia fell to 79.8m sqm in 2016 and further still in 2017 to 78m sqm. The Agency for Housing Mortgage Lending predicts volumes will rise in 2018 to 88m sqm and will continue to rise to reach 4.1bn sqm of total housing stock in 2023 – 18% more than in 2017.
The New Moscow development, which will grow the capital city by 1,500 sqm, is a major driver of new housing construction. By 2035, 60m sqm of residential property is due to be added.
Housebuilding forecasts for 2019 are strong, with continued demand for housing, fuelled by households’ higher purchasing power and the availability of subsidised mortgage loans.
The EECFA forecasts the percentage of households capable of purchasing homes will rise from 35% in 2016 to 55% in 2019, pushing housing sales up from 620,000 to around 980,000.
Interior and DIY market in Russia
The mortgage market rising – a huge 30% in 2017 – is positive news for Russia’s interior and DIY sectors as increased house buying fosters home improvements as residents make their new house a home.
The interiors sector has remained buoyant throughout the country’s recent economic downturn and forecasted increases in consumer spending will only prove to boost the market further.
The DIY market is still showing positive signs across the country. Wholesale and retail trade of DIY products and materials grew 3% in 2017 year-on-year, and further growth of 3% is expected to continue from 2018-19, according to Info-Line information agency.
The agency reports that in 2017 the 10 largest DIY market players showed revenue growth of 14%, with total revenue reaching 436bn roubles.
Optimism remains high, with 80% of DIY market players expecting sales to grow in 2018, according to Info-Line’s report presented at MosBuild 2018’s DIY Forum.
Taking advantage of the market
A huge market with growth on the horizon, Russia is ripe with opportunities for international suppliers of materials and products.
If you are a manufacturer or supplier of building or finishing materials looking to grow your business leads in a new geography, MosBuild 2019 is your route to the Russian market.
Russia’s largest build and interiors exhibition, offering the widest sector spread, MosBuild attracts 65,000 professional visitors, largely representatives of wholesale and retail businesses actively looking for top quality materials and products.
Find out more about the benefits of exhibiting at MosBuild 2019.