Differential family mortgage rates received approval from Vyacheslav Volodin for implementation
In a bid to address the growing disparities in housing affordability across Russia, a proposal has been put forward to introduce regional mortgage interest rates. This move aims to make borrowing costs fairer by linking interest rates to regional economic conditions and average salaries.
The idea, initially proposed by Valentina Matviyenko, suggests that mortgage rates should be lower in regions with lower average incomes and higher in more economically prosperous regions like Moscow and St. Petersburg. The goal is to support population retention in smaller towns and regions with lower living costs.
Vyacheslav Volodin, the State Duma speaker, has voiced his support for this approach, stating that mortgage interest rates should differ between regions like Saratov and Moscow, with rates in Saratov being proportional to the average salary in the Saratov region. The President has also reportedly endorsed the idea, with the government currently in discussions about its implementation.
The family mortgage program, as it stands, includes the purchase of secondary housing in cities with no more than two new buildings. The initial down payment for this program is at least 20% of the loan amount, and the property bought must be in a multi-apartment building no older than 20 years and not dilapidated.
The maximum loan amount for this program is 12 million rubles for major cities and 6 million rubles for other regions. A subsidized mortgage program at 6% is available for families with certain circumstances, such as families with children under six, children with disabilities, and families with at least two minor children in small towns.
It's worth noting that, according to Volodin, the current mortgage rate is the same for buying property in Moscow and regions where salaries can be significantly lower. This disparity in affordability has led to more than 50% of family mortgages being issued in Moscow, Moscow region, St. Petersburg, and Leningrad region, but more than 40% of borrowers live outside these regions.
The Ministry of Finance supports the idea of issuing family mortgages at the place of registration of the borrower. However, the purchase of secondary housing under the family mortgage program can only be done once.
These proposals come in the context of the earlier state mortgage subsidy program closure in July 2024, which had supported mortgage loans at rates around 8% but ended, leading to a sharp decline in new home sales and mortgage issuance in 2025. The subsidy ending coupled with high central bank rates (around 18% in mid-2025) has made mortgages less affordable nationwide.
In summary, the introduction of regional mortgage rates is seen as a more socially equitable mortgage policy to counteract the negative effects of uniform high rates and subsidy withdrawal, stimulating more balanced regional development. This approach is intended to promote social justice, ensuring that interest rates are not uniform across the country but instead adjusted to better suit local economic realities.
- In light of the upcoming closure of the state mortgage subsidy program, discussions are underway to implement a more socially equitable mortgage policy by introducing regional mortgage rates.
- This new policy, supported by key figures in finance, politics, and business, aims to address the housing affordability disparities by setting interest rates according to regional economic conditions, average salaries, and living costs.
