The relatively young Russian mortgage market developed rapidly in 2020, all thanks to the coronavirus. The country's authorities have launched mortgages with a subsidized rate to support demand for housing and prevent failure in the construction industry amid the spread of COVID-19. The trick was a success, but now Russia may be facing a mortgage crisis. In recent months, experts and even some officials have repeatedly stated the risk of its development. At the same time, representatives of various government agencies began to actively deny this possibility. Whether this is a psychological defense mechanism, when the subject refuses to admit the existence of a problem, or a truly strong belief in the stability of the housing lending market, is not yet clear. Debt madness, lessons from the American crisis and the elusive mortgage bubble - in the material of Lenta.ru.
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The mortgage market in the crisis year of 2020 is indeed growing at a record pace - and participants in the housing lending market openly admit that this is happening primarily due to measures to support the construction industry, which were initiated by President Vladimir Putin. The main such measure is the launch of preferential mortgages for the purchase of apartments in new buildings. He announced the program in mid-April, and a couple of days later Russian banks began offering corresponding loan products - at an unprecedented 6.5 percent per annum.
2,7
trillion rubles
borrowed by Russians to buy housing in the nine months of 2021
In previous years, a rate of 10 percent was considered low, so the demand for “Covid” mortgages was high. Developers also came to the rescue, timely organizing remote sales of apartments and free taxi rides to sales offices - it was possible to buy housing even during the period of self-isolation. After its completion, a real rush began on the new buildings market. They bought mainly on credit - according to the Dom.rf financial institution, the share of mortgage transactions in apartment buildings under construction currently reaches 90 percent. A study prepared by Raiffeisenbank specialists showed that 59 percent of Russian millennials (people born after 1981 and before 1996) plan to purchase housing in the near future, of which 79 percent intend to take out a mortgage.
Photo: Valery Melnikov / RIA Novosti
According to preliminary estimates from Dom.rf, over the nine months of 2020, more than a million mortgage loans worth 2.7 trillion rubles were issued in Russia - almost the same as for the entire 2021. “If the development of the situation with the coronavirus pandemic does not require the introduction of strict restrictive measures, then this year Russians will issue more than 1.5 million loans worth 3.7 trillion rubles,” says the bank’s materials (available to Lenta.ru).
August has already officially become a record for the domestic mortgage market - then 148 thousand housing loans were issued for 375 billion rubles (data from Dom.rf and the Frank RG agency). The previous absolute record was set in July, when Russians took out mortgages worth 362 billion rubles.
“We see that the mortgage market has fully recovered from the negative consequences of the coronavirus pandemic,” states Dom.rf. There is not a word about how much the financial well-being of Russians has recovered and what the mortgage craze threatens.
For individual specialists
Military mortgage
Thanks to a special program, a serviceman can buy an apartment without investing his own money. The down payment will be provided by the state, which will also make monthly payments on the loan. At the same time, a person must serve a certain period of time, otherwise he will have to return the money spent on him by the state. There are two possible scenarios when he will not owe anything:
- serve at least 20 years;
- serve at least 10 years and resign for good reason.
The maximum loan amount is 2 million 590 thousand rubles. If the loan was larger, you will have to pay off the balance yourself.
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