The head of Sberbank explained the reasons for the cancellation of preferential mortgages 18:00

Sberbank President and Chairman of the Board of Directors German Gref said that the Russian mortgage market “will have to suffer for several years” to return to normal balance after the cancellation of the state-backed concessional mortgage program after July 1. The head of the company is quoted by the press service of the financial institution.

According to President Sber, the consequences of curtailing the program will be, although not so dramatic.

German Gref noted that Sberbank is a supporter of state-supported mortgage reduction and advocates a targeted approach.

He also said the program should have been certified earlier.

“We delayed exiting that program and it created a tremendous imbalance in the market,” the company’s president said.

He explained that housing affordability has fallen by about 10% as a result of delays in the preferential mortgage program and the end consumer (citizens) is not feeling any better about it.

German Gref explained that the preferential mortgage program was considered “absolutely correct” during the coronavirus pandemic in 2020, but its time has long passed and it has recently been “ineffective from the front”.

The President of Sberbank compared the preferential mortgage with addiction to stimulant drugs for the body.

As an example, he cited a case where an athlete took stimulant drugs to show good results from a distance, but then had to turn to specialists to treat the body. Graf believes that this is certainly true for mortgages.

Let us remind you that the program of collective preferential mortgages for housing purchases at a rate of 8 percent in new buildings in Russia ended on July 1. The program was launched to support the construction industry and Russians during the pandemic. Its effect was planned to last for several months. However, the government later extended the program four times.

Sberbank reported that during the “State Support” program the bank issued more than 880 thousand loans to customers for a total amount of 3 trillion rubles.

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Source: Gazeta

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