Changes in the “Family Mortgage”: what will happen to the prices of new buildings

Beautiful white and pink flowers blooming in a garden on a sunny day.

The updated program will be valid until 2030. In connection with its extension, an additional 66.2 billion rubles will be allocated from the budget

 Изменения в «Семейной ипотеке»: что будет с ценами на новостройки

On July 10, the Ministry of Finance published new parameters of the Family Mortgage program. Now the rate of 6% per annum will be available to families with children under the age of six, as well as families raising a minor child with a disability. The subsidized rate also applies to individual regions. Experts were asked about how the innovation will affect prices for new buildings.

Who can now take out a loan under the family state program

As follows from the parameters of the program published by the Ministry of Finance, the rate on it will be 6%, the maximum loan amount is 12 million rubles. for Moscow, the Moscow region, St. Petersburg and the Leningrad Region, RUB 6 million for the rest of the regions. You can take out a loan for a large amount: up to 30 million in the capital regions and up to 15 million rubles. — in other regions of the federation. But in this case, the mortgage will be combined: the rate of 6% will apply only to the above limits of 12 million and 6 million rubles, and the remaining amount will be credited at the market rate, which, according to statistics, “Dom.The Russian Federation”, is 19.46% for banks from the top 20 in terms of issuance (data for July 1-7, 2024),

The first payment on a family mortgage will be from 20% of the value of the purchased property, the loan term is up to 30 years.

The following categories of borrowers will be able to use the updated family mortgage:

  • families with at least one child under the age of six;
  • families with a disabled child;
  • families from small towns (up to 50 thousand inhabitants) where there are two or more minor children;
  • families with two or more minor children living in regions with low construction volume or in regions with individual development programs;
  • “At the birth of a child, you can refinance a previously issued loan,” the Ministry of Finance said in a statement. As before, the program applies not only to apartment buildings, but also to the segment of individual housing construction (IHS). But it is possible to build a house or buy it under a family mortgage only if the construction is carried out under Federal Law 214 or under a contract with the mandatory opening of an escrow account. Another important condition is that you can use a family mortgage only once.

    “In general, we can say that the family mortgage has remained in the same form as it was before. When the family mortgage was first launched, it was provided to families with children born between 2018 and 12/31/2023 (i.e. children under 6 years old) — what has been preserved in general, — says Yuri Nikitchuk, head of the Lending and partner programs department at PIONEER. — Families with children with disabilities, as they were in this program, have remained. The only adjustment that will affect the Moscow and Leningrad regions is for families with two or more minor children over the age of 7 years (inclusive). The new construction market has been working with this segment of customers at the turn of a year and a half.”

    The old rules of the family program have ceased to apply since July 1, 2024. Previously, a preferential loan was available to families at the birth of their first child and if the family already has two or more minor children. Since July 1, preferential mortgages for new buildings with a rate of 8% have also been completed. 

    Large banks have already responded to the update of the parameters of family mortgages. At the time of publication, Sberbank, VTB and Dom.RF Bank announced the start of accepting applications under the new rules. “All applications submitted by our clients under the Family Mortgage program up to today will be reviewed by the bank under new conditions,” said Kirill Tsarev, First Deputy Chairman of the Sberbank Management Board.

    How will the changes in the program affect the prices of new buildings

     Изменения в «Семейной ипотеке»: что будет с ценами на новостройки

    Moscow(Photo: Studio MDF / Shutterstock / FOTODOM)

    The main users of the family state program, as Yuri Nikitchuk notes, are families with young children. “In other words, the adjustments made will not significantly affect the number of family mortgage loans in large cities,” the expert concludes.

    “The impact of changes in the parameters of the family mortgage will not be as significant as the termination of the mortgage state program, since the latter was given out massively to those who were objectively in need, and to those who just wanted to make money on rising prices,” says Irina Nosova, senior director of the ACRA Financial Institutions ratings group.

    Whitewill’s top broker Oksana Romanovskaya estimates the share of families with children under the age of six at about 30% of the entire target audience of the new building market.

    “Of course, the new conditions will have a beneficial effect on sales in small towns and regions with a low volume of construction,” Romanovskaya believes. — However, I do not think that this will greatly activate price growth and construction in general in the regions, because the segment of buyers who can take advantage of the current conditions is limited.”

    Other experts also say that the demand for new buildings in small towns is low now. Thus, according to the CIAN, in 2024, such cities accounted for no more than 1.7% of all transactions with new buildings in the country. The offer of new buildings is currently represented in only 71 small towns out of 809 — despite the fact that, in general, this type of settlement accounts for more than 70% of Russian cities.  

    The rating agency of the construction complex (RASK), at the request of RBC Real Estate, calculated how the presence of developers in Russian cities is growing. According to their estimates, if in 2021 there were 305 cities under construction (27.3% of the total), then in 2024 there were already 346 (30.9%).

    Adjusting the parameters of a family mortgage can contribute to a partial flow of demand to small towns, especially in metropolitan areas and where there are cities with millions, says Ruslan Syrtsov, managing director of Metrium. “In small towns of up to 50,000 people, the terms of lending have remained the same. Given the tightening of parameters in larger settlements, we can expect an influx of customers to these locations — primarily for the construction of cottages,” the expert predicts.

    The construction of residential real estate in small towns over the past 30-35 years has been practically non-existent, so there is potential for developers there, says Irina Nosova from ACRE. “Housing prices in small towns will rise, but not at the same pace as in millionaires,” the expert believes.

    According to Ruslan Syrtsov, prices in the capitals may decrease due to the adjustment of the program. “In Moscow, tightening the parameters of family mortgages will affect the market more seriously than non-renewal of preferential loans at 8%. In the first half of 2024, more than 40% of borrowers in the capital used a family mortgage, explains Syrtsov. — At least half of them were able to apply for a loan due to the presence of two or more minor children over the age of six. Now this category of customers remains unsupported. As a result, there may be a temporary decline in sales in the mass segment, which is most dependent on preferential programs.” As a result, the expert predicts, developers of new comfort and even business class buildings may adjust prices downwards. Most likely, he believes, the reductions will be due to discounts.

    Special offers and discounts from developers

     Изменения в «Семейной ипотеке»: что будет с ценами на новостройки

    Vladivostok (Photo: Yuri Smityuk / TASS)

    “There is a high probability of an increase in the key rate at the next meeting of the Central Bank. Due to the high interest rate, most of the citizens who cannot use a preferential mortgage will postpone the process of purchasing real estate, — says Yuri Nikitchuk. “In other words, the main driver of sales in the next six months will be due to the saved family and IT mortgage.” It follows that developers will have to think about maintaining demand, the expert concludes.

    “As for big cities, large regions and capitals, in my opinion, developers will now actively work out installment programs that are increasingly comfortable, with payment of the principal amount until the completion of construction, that is, when the hope for a reduction in rates will be much higher,” Oksana Romanovskaya shares the forecast. “This will be the main development trend until the end of this year.”

    “Developers are already working with banks to develop programs with a more affordable rate and a comfortable payment for customers,” says Yana Glazunova, CEO of VSN Group. Irina Nosova also predicts a wider spread of discounts on new buildings.

    Ruslan Syrtsov also speaks about this: “I am sure that developers of the mass segment, most dependent on family mortgages, will resort to discounts and other promotions more often in the near future,” the expert predicts. “The situation will change only if the Central Bank’s key rate is lowered or new targeted government programs are introduced: for teachers, doctors, defense industry employees, etc.”

    At the same time, experts interviewed by the editorial office believe that adjustments to the family state program are likely to lead to a certain overflow of demand into the rental segment, especially in large cities with high housing prices. “Rent will be in high demand, because housing affordability for the population has significantly decreased as a result of preferential programs,” Irina Nosova emphasizes.

    “If we offer clients only market programs, of course, the potential buyer will continue to rent real estate. It is possible to provide comfortable conditions for the purchase of real estate in new buildings, if we are talking about a market mortgage, only through special programs,” says Yuri Nikitchuk, head of the lending and partner programs department at PIONEER.

    Oksana Romanovskaya notes that the adjustment of the state program will not have a significant impact on the secondary market, unlike the rental one. “Most likely, the secondary market will decrease significantly, and the seller who will be ready to offer the greatest discount will sell,” the expert says. “As for housing rentals, then, of course, this segment is now going to grow more and more actively, since there is a large percentage of buyers who postpone buying until better times, namely, before the Central Bank rate cut.” Ruslan Syrtsov also points to this trend. “In this regard, rental rates will almost certainly increase,” the expert concludes.


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