Moscow Exchange to launch Moscow real estate benchmark in cooperation with Sberbank

On 10 August 2020, Moscow Exchange began calculating and publishing the Moscow Real Estate DomClick Index based on data from DomClick (part of the Sberbank ecosystem) based on mortgage transactions from Sberbank.

• The Index tracks the weighted average price per square meter of residential space across the city of Moscow.
• The Index includes apartments in multi-story apartment buildings and excludes luxury real estate (with a sale price exceeding RUB 30 million) to avoid price misrepresentation.
• The Index was calculated retroactively to late 2016. The index value was RUB 159,647 per sq meter of space as of 28 December 2016 and RUB 188,578 as of 5 August 2020.

The Index is calculated on a weekly basis and is reviewed quarterly. The Index code is MREDC.

The Index methodology as well as amendments and supplements thereto was developed based on recommendations from the Expert Council on Real Estate Market comprising representatives of Moscow Exchange, Sberbank, DomClick, DOM.RF, Lomonosov Moscow State University and the Financial University of the Russian Government.

Igor Marich, member of the Moscow Exchange Executive Board, said:

"The Real Estate Index developed jointly with Sberbank is a unique benchmark as it is the only real estate market gauge in Russia that is based on actual transactions. We hope that the index will be recognized as the price benchmark for the Moscow residential real estate market.

"We will consider offering a futures contract on the gauge at a later date. It will allow investment funds and retail investors to implement strategies to benefit from changes in real estate prices. Developers will be able to hedge market risk and financial companies will create new structured products to help retail investors accumulate funds to purchase real estate or a make a down payment."

Vladimir Yarovoy, Senior Managing Director, Head of Electronic Markets at Sberbank, said:

"Combining the competencies of Sberbank and Moscow Exchange allows us to create useful and sought-after index products for a wide range of investors. I believe that the Moscow Real Estate Index reflects households’ business activity in one of the most important consumer markets and will improve the market’s convenience and predictability for clients. The Index based on actual transactions and updated weekly will serve as a reliable analytical tool for investments in real estate."

Alexey Leipi, Managing Director at DomClick, said:

"Price Analysis is a unique service for apartment online assessment based on actual mortgage transactions with Sberbank. It helps determine the optimal price of an apartment, both for the buyer and the seller. It is a precise algorithm as it compares apartments across more than 40 parameters and tracks real estate price trends. Furthermore, the service provides a sample for in-depth analysis as the vast majority of mortgage deals in Russia are made with Sberbank. The joint initiative by DomClick and Moscow Exchange has the logical expansion of the product. In the future, this will allow for the creation of real estate market analytics and monitoring of market dynamics using this data."

Sberbank is Russia’s largest bans and a leading global financial institution. It holds nearly one-third of the total banking assets in Russia. The bank is a key lender for the national economy; it holds the majority of the country’s deposits. Sberbank offers its services in 18 countries all over the world. It operates the widest network in Russia, with 14,000 branches. Its network abroad includes subsidiaries, branches and representative offices in the UK, the US, the CIS, Central and Eastern Europe, India, China and other countries.

DomClick by Sberbank facilitates the search, purchase, sale or rental of real estate, applying for a mortgage, registering a transaction electronically and settling it safely for the buyer and seller remotely. The site offers more than 2 million live listings for the sale or rent of real estate. With the service, it will take five minutes to apply for a mortgage and get the bank’s response within 24 hours. More than 8 million users visit the website monthly; it is among the real estate online leaders in Russia in terms of traffic. More than 419,000 mortgages worth RUB 1 trillion have been issued via DomClick.ru.

MOEX operates Russia’s main trading platform for currencies, money market instruments, equities, bonds, derivative instruments and commodities. The Group includes the central securities depository (National Settlement Depository) and a clearing center (National Clearing Centre), performing the functions of central counterparty on the markets, which allows MOEX to offer its clients a full range of trading and post-trading services. The company’s free float stands at 62.8%.