Sberbank, the largest bank in Russia, has taken significant measures to reduce mortgage rates, effective March 4, 2025. The new rates reflect a decrease of 1–1.5 percentage points depending on the size of the down payment. If borrowers provide more than 50% of the property's value as a down payment, the minimum mortgage rate for primary housing is set at 28.2%, with the rate for secondary housing at 27.6%. For those with down payments ranging between 20% and 50%, the rates will decrease to 28.7% for primary and 28.1% for secondary housing.
The decision to reduce these rates has been linked to recent economic trends, particularly the decline of federal loan bond values and the overall cost of funding within the market over January and February 2025. According to Sberbank's press service, they are among the first large financial institutions to implement such changes, aiming to make borrowing more accessible during challenging economic times.
From the beginning of 2025, Sberbank has issued approximately 45,000 mortgage loans, amounting to nearly 194 billion rubles, as reported. The bank’s total mortgage portfolio now stands at 10.9 trillion rubles, highlighting its dominant position within the Russian housing finance sector. Innа Soldatenkova, the head of expert analytics at Banki.ru, noted, "Receiving approval under current requirements poses challenges for most people." This indicates the difficulties borrowers face even with the new rates.
Soldatenkova elaborated on the challenges facing consumers, emphasizing the high cost of property combined with rigid financial requirements set forth for mortgage approvals. She advised potential homebuyers to approach mortgages with caution, ensuring they can manage repayment obligations efficiently. "It's only sensible to proceed with mortgage financing if there's confidence it can be settled quickly, perhaps through the sale of another property," she said.
The mortgage market's response to the recent interest rates set by the Central Bank, which currently stands at 21% per annum, has been closely watched. Market analysts suggest this year could be particularly tough for mortgage lending, with anticipated loan issuance dropping to levels not seen since 2019. With many banks tightening their wallets, the total number of mortgage loans expected to be issued may hover around 1.2 to 1.3 million, totaling about 4 trillion rubles.
Sberbank's recent adjustments also come amid increasing concerns over outstanding mortgage payments, which reportedly rose by 57% last year to 108 billion rubles. Bank of Russia data suggests Moscow, the Moscow region, Krasnodar Territory, and St. Petersburg lead the charge for non-payment. This trend indicates severity within the housing market, challenging the economic stability of many households.
Despite the current challenges, Sberbank, through its significant share of 57% of the mortgage market at the end of 2024, remains committed to providing financial products aligned with shifting market conditions. Their latest rate cuts may reflect just one step among many intended to stimulate mortgage lending and help consumers navigate the often-tumultuous waters of property financing.
With inflation and economic policies ever-changing, potential borrowers are encouraged to remain informed and consult carefully with financial advisors. Observing expert guidance will help people make prudent decisions as they enter the mortgage market.