Government's Financial Department endorses proposition for family home mortgages to be granted at the time of property registration
Russian authorities are considering amendments to the family mortgage program, aiming to curb the use of subsidized loans for purchasing or building homes solely within the borrower's registered region of residence. The proposed changes come in response to concerns that a significant portion of these loans are being used outside the borrower's registered regions, leading to unequal regional housing development and potential exploitation for investment purposes.
Prime Minister Mikhail Mishustin has submitted proposals to amend Government Resolution No. 1711 from 2017, requiring that subsidized family mortgage loans be used exclusively within the borrower’s registered region. This move is intended to improve living conditions for families with children across all of Russia, rather than just in major urban centers.
Valentina Matviyenko, the speaker of the Federation Council, has also proposed that family mortgages should only be issued in the region where the borrower is registered, as over 40% of borrowers currently live outside these regions. If adopted, the amendments would come into force in the first quarter of 2026, according to Anatoly Aksakov, the head of the State Duma's Financial Markets Committee.
The family mortgage program, as it currently stands, has certain restrictions. For instance, it only allows for the purchase of secondary housing once, and the initial down payment is at least 20%. Moreover, purchase from related parties is prohibited, and the property purchased must be in a multi-apartment building no older than 20 years and not be in disrepair.
The program also extends to the purchase of apartments or houses from developers, as well as building your own house with a contractor using escrow for payment. As of April 1, the family mortgage program has been extended to secondary housing in cities with no more than two new houses.
The preferential program, currently available at 6%, is available to families with children under six, families with children with disabilities, and families with at least two minor children in small towns. The maximum loan amount for large cities under the family mortgage program is 12 million rubles, while it is 6 million rubles for other regions.
Ivan Chebeskov, deputy minister, has expressed support for Matviyenko's proposal and has suggested it is necessary to prevent the use of preferential programs for investment purposes. Chebeskov also stated that it is important not to deprive people of the right to use this mechanism if they move.
The proposed amendments are under consideration, and further instructions or legislative changes are expected. The goal is to make family mortgage support more equitable and to boost housing construction and development throughout the country.
The Prime Minister, Mikhail Mishustin, has submitted proposals to amend the family mortgage program, aiming to restrict the use of subsidized loans for business activities and ensure they are used exclusively within the borrower’s registered region. This move is intended to improve living conditions for families with children across all of Russia by preventing the exploitation of these loans for investment purposes.
Valentina Matviyenko's proposal, which requires family mortgages to only be issued in the region where the borrower is registered, is also intended to curb the use of these loans for business or investment purposes outside the borrower’s registered regions. If adopted, these amendments could potentially improve business fairness by preventing the unequal regional housing development that arises when loans are used for investment purposes outside the registered regions.
