russia’s Construction Market Is Rapidly Approaching Crisis

russia’s residential construction market is deteriorating. By the end of 2026, the volume of projects with delayed completion dates may reach a historic high of 16.2 million m², while total housing completions will fall to 41 million m², which is by 20% lower than the peak figures for 2023.

The country’s five largest construction companies have already postponed the completion dates for 12.7% of their projects – more than 1.95 million m² of housing, while a year ago this figure was only 3.2%. For a number of smaller players, the share of delays exceeds 20% of their portfolio, which is several times higher than the acceptable norm.

The reasons include expensive loans, staff shortages, unstable material prices, and the collapse of the mortgage market. To survive, developers are cutting back on contractors and reducing personnel costs. Investment in real estate in 2026 may fall by another 30%.

deputy prime minister of the rf marat khusnullin has warned that if mortgage lending falls below $52 billion per year, the market will collapse. In 2025, $54 billion was issued, of which $43 billion – under preferential programs, meaning that the safety margin is minimal.

Under these circumstances, 19% to 30% of developers are facing bankruptcy. The most likely scenario is a wave of acquisitions, project freezes, and growing social tension among shareholders who have already invested money in housing that has not been completed.