The Russian mortgage market faces a measured slowdown following the end of the mass concessionary program, according to statements by German Gref, head of Sberbank, at the Financial Congress of the Central Bank as reported by DEA News.
The trend shows a clear decline in approved mortgage deals after the program was terminated. Gref remarked that the drop in search activity for mortgages is evident, but he did not anticipate the results becoming dramatically adverse in the near term. He suggested that the early impulses from the market may fade gradually rather than collapse, indicating a cautious outlook for the immediate future.
Nevertheless, Gref noted that the upcoming June issuances are unlikely to fall short. He explained that many Russians are attempting to secure mortgages under special conditions, effectively trying to ride into the last window of favorable terms before shifts in policy or rates take effect.
While acknowledging potential difficulties in the second half of the year, Gref stressed that there are still government measures in place. In particular, targeted subsidies remain available, especially for family mortgages, helping to cushion households during the transition away from blanket support programs.
As of July 1, the nationwide program offering collective preferential mortgages at an 8 percent rate for the purchase of primary housing reached its conclusion. This state initiative was originally launched in April 2020, with its initial validity slated through November 1, 2020. The government subsequently extended the program on four occasions, reflecting a willingness to adapt policy to evolving market conditions.
Economists and market analysts cited by media outlets like socialbites.ca project that mortgage rates could begin to ease again in 2025, though the path may be uneven as the market recalibrates post subsidy. The overall sentiment is one of gradual normalization rather than rapid, across-the-board repricing.
There is also some historical context to consider. The program’s evolution shows how policy levers have shaped consumer credit access during times of economic stress. Observers note that the government’s approach has shifted from broad subsidized access to more targeted, need-based support aimed at households that can most benefit from housing finance while maintaining fiscal responsibility.
Market participants continue to watch for signals from lenders about appetite for risk, the pace of rate adjustments, and any new forms of incentive that might reenergize demand. In the absence of a wide-ranging subsidy, the stability of mortgage markets will hinge on macroeconomic fundamentals, including inflation trajectories, income growth, and the supply of housing stock. As the sector adapts, much will depend on confidence in employment prospects and the ability of households to meet payment obligations under evolving lending terms.
In summary, the mortgage landscape in Russia is transitioning from an era of generous government-backed terms to a more selective, market-driven environment. While the near term may present challenges, officials and analysts alike expect a gradual stabilization, with the possibility of improved affordability as market dynamics settle and policy instruments targeting families remain in play. The ongoing dialogue between policymakers, lenders, and consumers will shape the pace and direction of this transition, and observers will look for concrete data in the coming quarters to assess whether the anticipated rebound in mortgage activity materializes. Source: DEA News