In January 2024, Russian banks began to more often refuse to issue concessional mortgages for purchasing housing in the primary market. The report highlights this trend, citing the company Etazhi as the source of the news.
“In fact, only about half of the applications for new buildings under concessional mortgage programs are approved,” stated Tatyana Reshetnikova, deputy head of Etazhi’s mortgage department. This observation underscores a tightening environment, where many hopeful buyers encounter denials or delays as lenders reassess risk and criteria.
Reshetnikova explained that the rise in refusals followed changes to the conditions for granting privileged loans at the end of 2023. Since October 1, Russia tightened the minimum down payment, raising it to 20%. This shift has narrowed the pool of eligible borrowers and increased the upfront financial burden for prospective buyers.
She also noted that banks have grown more selective in their borrower assessments. In particular, lending institutions began applying higher income requirements, which further reduces the number of applicants who meet the threshold for concessional financing.
Earlier reports indicated that the volume of mortgage loans issued in the Russian Federation reached a historical high, signaling buoyant activity in the market despite tougher conditions for privileged programs.
Economist Andrei Barhota later addressed the Bank of Russia’s statements on privileged mortgages, offering analysis on how policy shifts may affect lending dynamics and borrower accessibility.