General Assessment

Variable	(2017)
Variable	Data
Main constraints in the development of the housing finance sector	The main constraint of the Russian mortgage market is the imbalance between the income of citizens and the cost of housing and high interest rates. Low affordability of mortgage - approx. for top 40% of income distribution as of 2017
New developments that will have a major impact on the sector	Non-standard mortgage product - credit for buyer of the flat on the stage of construction. So the lien is purchaser rights on special contract between him and developer rather than real estate. Such product got large market share (approx. 20-30% of mortgage market as of 2018). At the same time project finance in construction is extremely low. So credit resources for residential construction (multi-family) are provided mainly through consumer credits rather than trough developer credits. But in 2018 the reform was performed - after the 1st of July 2019 developers are prohibited to use the upfront sales revenues (people money) for construction finance, they can use only project finance for the banks. So in 2 or 3 years such exotic mortgage products should vanish.

HOFINET | Housing Finance Information Network