Putin wants mortgage rate to fall to refinancing rate plus 2.5 pp

MOSCOW, Jan 29 (PRIME) -- The Russian government must push mortgage rates down, to the refinancing rate, now at 8.25%, plus 2.0–2.5 percentage points, President Vladimir Putin told a government meeting on Wednesday, as cited by RIA Novosti.

“The progress is evident, but you’ve seen it for yourselves that our targets say that the mortgage rate must be a little over 2.0-2.5 percentage points over the refinancing rate,” Putin said.

“There is something to work at here, please pay attention to it.”

First Deputy Prime Minister Igor Shuvalov agreed that the mortgage rate cannot be called too low.

“At present, the average weighted rate amounts to 12.5%. This is certainly lower than when we started (15%), but is still quite for Russian citizens. In this part, it could not be called fully affordable,” Shuvalov said.

According to preliminary data, Russian banks allocated over 800,000 mortgages worth over 1.3 trillion rubles in 2013. More than half of the loans were provided by Sberbank, the country’s largest bank by assets.

Shuvalov said that banks provided 14,500 loans per year 10 years ago.

(34.6250 rubles – U.S. $1)

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