The volume of mortgage transactions in Russia is expected to drop by about half after July 1, 2024, according to a briefing from a prominent real estate lawyer. The message circulating in the press center notes this pronounced dip, while also emphasizing that the situation does not signal an imminent market collapse. This point of view was shared by the expert during discussions about ongoing housing finance trends in the country.
In examining the overall picture, it is clear that the decline in mortgage activity is not a single-factor phenomenon but results from two main forces. First, the scheduled end of the non-addressable preferential mortgage program has reduced the sector’s support mechanisms. Second, there was an exceptional surge in loan issuance in June 2024, reaching 788 billion rubles, a level roughly 45 to 50 percent higher than in the preceding month. This sharp rise in June is viewed as a one-off spike rather than a persistent trend, with subsequent months showing a normalization of demand.
Earlier projections indicated that July 2024 would bring noticeable shifts in demand, particularly in major markets. In Moscow, data showed a fall in total transactions within the DDU, down by 35 percent compared with June and by about 10.4 percent on a year-over-year basis. The retreat in demand has been attributed to the removal of concessional mortgage programs, tighter eligibility criteria for family loans, and a gradual uptick in mortgage rates. These factors together created a cooling effect on borrowing appetite and a shift in buyer behavior in the housing finance segment.
Analysts point out that cities once favored for affordable housing rentals are now experiencing different dynamics as interest costs and loan conditions evolve. The evolving mix of incentives, pricing, and lending standards continues to shape where buyers choose to invest, and the broader financial environment in Russia remains a key determinant of mortgage activity. For readers in Canada and the United States, these patterns offer a comparative perspective on how shifts in government programs and rate environments can influence demand and lead to a more cautious but still active market in mortgage lending.