Russia’s Ministry of Finance has stated that it does not plan to raise the subsidized mortgage rates, despite an unexpected uptick in rates on August 15. This stance appeared in the newspaper News, citing a statement from the ministry’s press service.
One of Freedom Finance Global’s top analysts, Natalia Milchakova, interpreted the ministry’s remarks as a signal that current rates are not yet high enough for the authorities. She suggested that rates on concessionary mortgage programs could climb by 0.5 to 1 percentage point in 2024, though she emphasized that a more probable outcome could be the removal of government-sponsored mortgage initiatives entirely.
Finam analyst Igor Dodonov told Izvestia that with a 12 percent key rate, the government may still find funds to subsidize preferred mortgage rates. He cautioned that if the Central Bank of Russia (CBR) keeps tightening monetary policy rapidly, the likelihood of higher rates within the government programs would rise.
Earlier, the Central Bank of the Russian Federation implemented an unscheduled increase, raising the key rate to as much as 12 percent.
In this shifting landscape, observers note that policy choices hinge on balancing inflation control with support for housing demand. The government’s willingness to preserve subsidies could depend on the trajectory of inflation, the pace of monetary tightening, and the state of the housing market. Analysts also highlight potential fiscal trade-offs, including budget allocations for subsidies versus other stabilization tools. Market participants will be watching updates from the central bank and the finance ministry for guidance on future subsidy levels and program viability. As policy signals evolve, the mortgage sector may experience gradual adjustments, with investors and homebuyers alike seeking clarity on whether subsidized programs will continue, expand, or be phased out in coming quarters.
Overall, the period remains characterized by cautious optimism among lenders and borrowers. The path ahead is likely to involve careful calibration by policymakers, aiming to sustain housing activity while keeping inflation under control. The situation invites ongoing scrutiny of official statements, central bank actions, and the broader macroeconomic context that shapes mortgage affordability and credit conditions across the country.