The extension of Russian preferential mortgage program by another year will cost the country's budget 40 billion rubles ($554.6 million), the Russian Finance Ministry said on Tuesday, adding that it had prepared a draft government decree
MOSCOW (Pakistan Point News / Sputnik - 15th June, 2021) The extension of Russian preferential mortgage program by another year will cost the country's budget 40 billion rubles ($554.6 million), the Russian Finance Ministry said on Tuesday, adding that it had prepared a draft government decree.
Earlier in June, Russian President Vladimir Putin proposed to extend the cheap mortgage program until July 1 of next year, as well as raising its cap to 7% and lowering its limit to 3 million rubles ($41,520). The program, capping mortgage at 6.5%, was initiated in April 2020 to support citizens during the COVID-19 pandemic. It was already extended last October until this July 1.
"The estimated 2021-2024 budget costs for the extension of the 7% mortgage will be about 40 billion rubles, and the budget costs for the modification of the family mortgage for the same period will about 49 billion rubles," the ministry said in a statement.
It is also proposed to provide the family mortgage at a rate of up to 6% to families with one child born after January 1, 2018. The maximum loan amount for a family mortgage in Moscow, St. Petersburg, Moscow and Leningrad regions will be 12 million rubles, in other regions 6 million rubles.
In the meantime, Russian Deputy Prime Minister Marat Khusnullin said on Tuesday that the housing price hike in the country, witnessed since the introduction of the cheap mortgage program last year, was influenced not so much by the program as by the COVID-19 pandemic.
"The mortgage greatly boosts prices. We analyzed each settlement, each region, the Federal Antimonopoly Service did a great job, and proved that the mortgage on average influenced the price increase this is plus 4-5%. Everything else is not mortgage, it is really pandemic," Khusnullin told the Rossiya-24 channel, adding that "because of the pandemic, the construction [of housing] was delayed" or even suspended.