During the first half of the year, the twenty largest Russian banks issued a total of 681 thousand loans, amassing 2.8 trillion rubles in credit commitments. This activity marks a 16% decline from the same period a year earlier. The latest figures reflect a lending environment that has cooled somewhat, even as certain segments remained buoyant. The broad trend suggests financial institutions are recalibrating risk and adjusting to evolving market conditions after a period of intense activity in prior years.
The highest volumes of loan issuance occurred in June, when the top twenty banks collectively approved 92 thousand loans for new construction projects. This was a 62% rise from May and pushed the cumulative June total to 465 billion rubles, up 59% month over month. The surge in demand appears linked to expectations surrounding the expiration of a large preferential program, which had previously incentivized borrowing. Banks reported that prospective borrowers were moving quickly to secure financing before those advantages ended, driving a short-term spike in activity.
Mortgage activity for the construction of individual houses (IHC) also reached historic levels. The market registered a record 25 thousand IHC loans worth 93 billion rubles, underscoring sustained investor and builder interest in single-family projects despite broader financing headwinds. This segment’s strength reflects ongoing demand for home ownership and the perceived affordability of financing within targeted programs, as well as continued confidence in the housing market’s long-term fundamentals.
In June, mortgages under state-supported programs hit another high, with 137 thousand loans totaling 658 billion rubles. This milestone signals the continued appeal of subsidized financing for homebuyers and builders, even as macroeconomic conditions evolve. The persistence of these programs suggests policy tools remain a significant lever for stimulating housing market activity and household investment choices.
Industry observers anticipate a cooling of the Russian mortgage market in the second half of the year. The main reasons cited include the winding down of a large preferential program, elevated interest rates, and the challenging comparison base created by 2023’s high activity. Analysts emphasize that the yield environment, lender risk appetites, and consumer borrowing capacity will play central roles in determining how quickly volumes normalize. The predictability of rate paths and policy support will likely shape borrower timing and product mix in the months ahead.
Recent policy movements have added another layer of complexity. On July 26, the Central Bank of the Russian Federation raised the key interest rate from 16% to 18% per annum. This shift is expected to influence deposit and loan pricing, and it could also affect the ruble’s exchange rate. Market participants are weighing how higher rates will alter borrowing costs for households and developers, as well as how lenders will adjust credit standards in response to tighter monetary conditions. The full impact will unfold through a combination of loan pricing adjustments, credit appetite, and consumer demand patterns across mortgage segments.
Additionally, there has been notable activity in the consumer finance space, with Russians continuing to accumulate sizable volumes of auto loans. This trend underscores a broader appetite for vehicle financing and reflects the lenders’ ongoing efforts to diversify portfolios in the face of shifting macroeconomic signals. As the market absorbs rate changes and policy transitions, lenders, borrowers, and policymakers will be watching closely to gauge the durability of demand across housing and consumer credit.
Overall, the half-year data illustrate a housing finance sector that remains sizable and dynamic, even as operational and policy-induced headwinds create a more cautious borrowing environment. Stakeholders across banks, housing developers, and households are navigating a landscape defined by regulated incentives, evolving interest-rate levels, and the enduring appeal of homeownership within Russia’s financial markets. The coming months will reveal how much of the momentum persists and how much normalizes as the savings and investment calculus adjusts to new economic realities.