Financialization of Real Estate Markets as a Macroeconomic Trend of the Digital Economy

Abstract

The changes in the world economy since the early 1990s, such as the globalization of financial and commodity markets, deregulation of the financial sector, and its growing role in the economy, have led to significant changes in the real estate market, traditionally one of the most conservative markets. The process of financial institutions' entering the top players in the real estate market is most commonly referred to in various researches as financialization. In the last decade, this trend has been supplemented by processes associated with disruptive technologies that have emerged within the rapidly developing fintech industry and offer a number of mechanisms that make investing in real estate (crowdfunding), using real estate (sharing), and turnover of digital choses in action secured by real estate assets (tokenization) significantly more democratic. As a result, the excess of the total capitalization of the financial component of the market (including the growing digital share) over the total value of real estate assets can exceed reasonable limits and become an independent cause of another crisis similar to the 2006-2008 crisis in the United States.

Тенденции Развития Жилищного Рынка И Жилищного Строительства В Регионах России В 2022 Году

“…• market risks (reduction in demand for rental and purchase of housing as a result of the departure of some foreign businesses from Russia). The presence of the above risks and the influence of the uncertainty factor actually reduce the forecasting of industry prospects to assessing the opportunities and scale of support measures from the state [5][6][7][8].…”

“…Another 12 regions gained a positive momentum of housing commissioning, and only three of them, including Moscow, showed a reduction. 5,6,7,8 Against the previous year, there were noticeable changes within the traditional group of leading regions, due to reduced housing construction in Moscow and its real stagnation in St. Petersburg. The Moscow region has asserted its leadership in terms of the absolute volume of commissioning, and Moscow, due to a 13 % drop, closed the top three, having let the Krasnodar region go ahead.…”

“…End of the Table 4 Table 5. Housing commissioning in the Russian regions in 1999-2022 5,6,7,8 For the second year in a row, the percentage of individual housing built by the population at their own expenses or with the borrowed funds exceeded half of the total commissioning (55.7 %). Accordingly, the share of multi-apartment housing, which has been steadily declining since 2016, amounted to 44.3 % (Table 7).…”

“…However, production of cement, bricks, and concrete increased. Despite the ambiguous situation with production, prices for construction materials increased for the vast majority of items 8 . The decrease in production coupled with rising prices has a negative impact on the profitability of development for various classes of housing.…”