Russia’s construction industry boomed in the first years of the war in Ukraine as Russians sought refuge from sanctions, economic uncertainty and a weakening ruble by investing in property, while generous state-backed mortgages fueled demand.
But these days, the sector is running into trouble as the government scales back subsidies and reins in spending amid its own budget strains.
The latest round of restrictions targeted the subsidized 6% family mortgage program, limiting families to one mortgage between both spouses and banning the inclusion of third parties in mortgage agreements.
Those measures caused the value of subsidized mortgages issued by Russian banks to fall 62% year-on-year in February, 8% in March and 20% in April.
Total mortgage lending declined by between 9% and 21% in 2025, depending on the estimate, marking a second consecutive annual drop after the record-breaking year of 2023.
