Russia’s Putin calls for reducing mortgage loan rates

MOSCOW, May 17 (PRIME) -- The Russian government and the central bank must look for possibilities to reduce interest rates on mortgages loans, President Vladimir Putin said Tuesday at a State Council meeting.

“People’s need in improving their living conditions remains high, and it is possible to meet such demand only with the use of reliable market mechanisms, including mortgage lending. This particular instrument allowed for an increase in housing construction by 60% and economy-class construction by 90% over the last five years. Mortgage lending is a powerful engine of housing construction, and the government together with the central bank of course must look for opportunities to reduce rates on such loans,” Putin said.

Putin also did not rule out creation of a state compensation fund to solve problems of defrauded investors in shared construction, as current measures to defend their interests are not sufficient, he said.

The system of self-regulation in the construction sector requires reforms, Putin said.

There are currently 502 self-regulated organizations, whose aim is “to ensure quality, reliability and security of engineering surveys, designing and construction,” he said. But “operations of self-regulated organizations are often limited to access to certain types of works. Moreover, part of them are just selling such permits,” Putin said.

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