How much did you spend on a preferential mortgage in Russia in 4 years

Close-up of a delicious and colorful fruit salad in a glass bowl, perfect for a healthy breakfast or snack.

The cost of preferential mortgages for new buildings since 2020 exceeded 453 billion rubles Budget expenditures on preferential mortgages for new buildings since 2020 exceeded 453 billion rubles. This is not the final amount of costs — the program will be funded until all loans are paid off or mortgage rates are reduced to the preferential level

 Сколько в России потратили на льготную ипотеку за 4 года

After four years of work, the preferential mortgage on new buildings is being completed. It was launched in April 2020 as an anti-crisis measure, after which it was extended several times. But on July 1, 2024, the program finally terminates. According to the Ministry of Finance, from 2020 to 2024 (as of June 1), Russians under the program issued over 1.5 million loans worth over 5.8 trillion rubles.

We found out how much money was spent from the budget to finance the program and what amounts were allocated for its financing in subsequent years.

The cost of a preferential mortgage for 4 years

In total, from 2020 to 2024 (as of June 1), 453.1 billion rubles were paid from the federal budget to finance preferential mortgages for new buildings, according to statistics from the Ministry of Finance of the Russian Federation. Of this amount, 1.1 billion rubles were allocated from the budget in 2020, and 23 billion rubles in 2021. In 2022, the amount of refunds increased 5.7 times to 132.4 billion rubles, and in 2023 it decreased to 113.7 billion rubles. In the five months of 2024, 182.9 billion rubles were allocated from the budget to finance the program. As explained to RBC-Real Estate in the press service of the Ministry of Finance, a total of 230 billion rubles have been pledged under the program for 2024.

 Сколько в России потратили на льготную ипотеку за 4 года

Photo: RBC

The amount of subsidies for preferential mortgages depends on the number of loans issued and the level of the key rate. During the period of its high value, the cost of subsidizing mortgages increases, so the authorities allocate additional funds. For example, it was reported that this year the Ministry of Finance plans to increase spending on preferential mortgage programs by 25% due to the high level of the key rate.

“The subsidies themselves are budgetary funds, which are formed, among other things, at the expense of taxpayers,” explained Irina Nosova, Senior director of the ACRA group of ratings of financial institutions. As for the amount of 453.1 billion rubles spent over four years on financing preferential mortgages, it is not too large in terms of budget, said Anton Tabakh, chief economist at the Expert RA rating agency. “This is less than 0.25% of GDP over these years, annual budget expenditures are about 36 trillion rubles. So it’s not too much. But a relatively small group of fairly wealthy borrowers, developers and banks benefit from these expenses,” Anton Tabakh noted.

Planned expenditures for 2025-2026

Despite the completion of preferential mortgages for new buildings, the state will continue to subsidize the already issued preferential loans. That is, for another 30 years (if we count from the loans under the program, which were taken this year for a maximum period of 30 years), funds will be allocated for the program.

“The financing is planned for the next financial year and the planning period (2025 and 2026). In accordance with the budget law No. 540-fz, budget allocations for 2025 (102.5 billion rubles) and 2026 (53.4 billion rubles) are provided for preferential mortgages for new buildings,” the press service of the Ministry of Finance explained to RBC—Real Estate. Thus, over 156 billion rubles are provided for the next two years. “Regardless of the budget cycle, the obligations under the preferential program will be fulfilled by the Ministry of Finance in full for all 30 years,” they stressed.

At the same time, according to experts, the cost of financing the program may continue to grow, despite its termination. “This year and next, the burden on the budget for subsidizing the program will definitely increase, and quite strongly due to inflation expectations,” said the chief economist of the Expert RA rating agency. “Further, it is likely to fall as the key rate decreases and the mortgage is repaid,” he said.

 Сколько в России потратили на льготную ипотеку за 4 года

Photo: Andrey_Popov / Shutterstock / FOTODOM

A similar point of view was expressed by the senior director of the ACRA Financial Institution Ratings Group. In her opinion, if the key rate continues to rise, the burden on the budget will increase on loans issued. “Due to the expected reduction in disbursements under preferential programs, from July 1, the burden on the budget will decrease, provided there is no or a slight increase in the key,” Irina Nosova added.

How are preferential programs funded?

Preferential mortgage programs in Russia work according to the following scheme: the marginal rate on such loans is limited by government decree (for example, for a preferential mortgage on new buildings it is 8% per annum), and the difference between preferential and market rates is compensated by subsidies from the state budget. The amount of compensation is calculated as the key rate with a surcharge minus the rate under the loan agreement. The state subsidizes the key rate, increased by 2-5 percentage points, depending on the program. Subsidies for financing preferential mortgages are allocated to the operator of programs with state support — Dom.RF. After that, the Institute of Housing Development reimburses banks for lost income on housing loans issued at a reduced rate.

Government resolutions in September and December provided for a reduction in the amount of the surcharge for calculating compensation to banks. At the same time, the key rate in Russia rose sharply in the second half of last year — from July 7.5% to 16% in December — and remains at this level as of the end of June. Thus, the gap between preferential and market mortgage rates has increased, and the amount of the premium for compensation has decreased.

Housing affordability has fallen to a minimum

Despite the low interest rates on preferential mortgages for new buildings, housing affordability has significantly decreased during the duration of the program. According to Mikhail Matovnikov, head of the Sberbank Financial Analytics Center, the number of square meters that a recipient of a median salary can purchase in Russia using a mortgage has decreased by 6 square meters in the primary market since 2020, and by 9 square meters in the secondary market, amounting to 25.8 square meters. These are the minimum figures for the last ten years. “In terms of what we are currently building, we are at an absolute bottom. It has never been so bad in terms of what a normal person can afford to buy, taking into account mortgages and all subsidies,” Mikhail Matovnikov said at the conference, adding that there was an increase in affordability in some periods, but in general this indicator is decreasing.

 Сколько в России потратили на льготную ипотеку за 4 года

Photo: Oleg Opryshko / Shutterstock / FOTODOM

According to him, the main recipients of preferential programs were secured borrowers. Their share increased from 58.9% in 2020 to 85.4% in 2024. At the same time, the share of state support in total mortgage loans has increased. In the first quarter of 2024, the overall market figure was a record 70%, and in the new construction market — 96%. At the same time, in 2020, the share of preferential mortgages was at the level of 9%. “In other words, almost the entire market lives on subsidies,” he concluded Mikhail Matovnikov.

The share of borrowers with lower incomes has decreased during this time, and not only at the expense of borrowers with minimal incomes, but also average ones, said the chief analyst of Sberbank. We are talking about a mass segment, this is about a quarter of the population, people who could potentially take out a mortgage, whereas the wealthiest already have money, he explained. According to the analyst, the share of such borrowers has halved: from 25.1% in 2020 to 12.1% in 2024. “Why did she fall? The prices were raised. It’s not about the stakes. All this demand (from secured borrowers. — Ed.) developers put it in their pocket,” he added.

The decrease in housing affordability during the validity of preferential programs was noted in the State Duma. According to Sergey Pakhomov, chairman of the State Duma Committee on Construction and Housing and Communal Services, preferential mortgages led to price increases and worked more for the investor. The reduction in housing affordability was noted by ACRA analysts. “Preferential mortgages work if the growth rate of household incomes exceeds the growth rate of real estate values. The exact opposite happened with us. Developers turned out to be in a bigger advantage, we see this, in particular, in terms of their profitability,” explained Irina Nosova, senior director of the ACRA group of ratings of financial institutions.


Leave a Reply

We use cookies to give you the best possible experience on our site. By clicking "Accept", you agree to our use of cookies.