Building materials: falling, finding the bottom, and prospects for growth

The reasons for decline in GDP and investment in the Russian economy are analyzed. It is shown that the fiscal policy tightening against the background of the high key rate of the Central Bank leads to higher costs and lower profitability. One of the consequences of such a policy may be excessive consolidation of building materials production having further affect to the pricing policy. Transition to the completion stage of previously started facilities is leading to a faster decline in demand for key building materials. In the housing construction structure, there is a steady downtrend in the share of apartment building, as well as a speculative prices increase in the primary housing market, which are almost twice as high as prices in the secondary market. These factors combination contributes to a rapid decline in building materials demand and production: in January 2026 the decline in some types of construction materials production was more than 30%. According to the Ministry of Economic Development of Russia forecasts, the decrease in investments to fixed assets in 2026 will range from 0.5% to 1.3%. And this means a further drop in the building materials output. Some improvement in the situation against the background of the conflict between Iran and the United States is situational and short-term with unpredictable consequences.