Wind of change: the law on changing family mortgages may be adopted in early 2026
Early next year, the lower house of parliament plans to consider and approve an initiative introducing differentiated rates in the family mortgage program, said Anatoly Aksakov, chairman of the State Duma Committee on the Financial Market. How the change in rates will affect the availability of housing for families with children, whether the differentiation of rates will lead to more complicated conditions for obtaining a family mortgage, as well as how this decision will affect the housing market — in the Izvestia article.
Consequences of the changes
The upcoming changes to the family mortgage program, based on setting different rates based on the number of children in a family, will lead to serious consequences for the market and borrowers, Natalia Bogomolova, director of financial institutions ratings at the NRA rating service, told Izvestia.
"On the one hand, the current unified program requires significant budget allocations for subsidizing rates, and its modification is aimed at reducing budget expenditures and increasing the targeting of government support," the expert emphasized. — On the other hand, the reform is a targeted measure to stimulate the birth rate, which will lead to a redistribution of housing affordability in favor of large families.
Conditions will radically improve for families with three or more children (the rate will decrease to 4%), but they will be significantly tightened for families with one child (the rate will rise to 10-12%, which will also increase the monthly payment, which will tighten the requirements for a confirmed family income and make bank verification more difficult). Given that market mortgage rates are currently at a high level, as well as the fact that the number of large families is significantly lower than families with 1-2 children, an increase in rates to this level will significantly reduce the availability of mortgages.
At the first stage, in her opinion, a surge of interest from buyers is expected. Many will try to conclude deals before the updated terms come into effect, including the "one preferential mortgage per family" rule, which from February 1, 2026 assumes the participation of both spouses as co-borrowers.
After this point, a sharp decline in activity is likely, primarily in the segment of massive new buildings, where up to 90% of transactions rely on family mortgages, the expert believes. In the longer term, changes may push developers to work more actively with the housing format for large families, with a review of planning decisions and the development of the social environment. Financial institutions, in turn, will be forced to restructure borrower assessment systems and credit rules to fit a more complex risk structure.
Since families with one child currently predominate in Russia, an increase in the interest rate for them may significantly narrow the possibilities of buying a home on credit, Ekaterina Shchurikhina, director of banking ratings at Expert RA agency, told Izvestia. An increase in monthly payments will lead to the fact that some of those who wish will no longer be able to pass a bank check on the level of debt burden.
Nevertheless, even with such changes, the government–backed program will look more attractive compared to conventional mortgage products for at least another year and a half, the expert believes.
"The expected changes in the program may lead to an increase in family mortgage payments by 20-30% in late 2025 and early 2026 due to the desire of borrowers to apply for loans on the same terms," the expert noted. — At the same time, closer to the middle of 2026, the potential decrease in family mortgage payments will be offset by an increase in lending in the market segment as the PREP continues to soften and mortgage rates decrease.
Mortgage development
First of all, it is important that the family mortgage is the largest instrument of state support in the housing market in terms of coverage, Alexey Voylukov, MBA professor of business practice in digital finance at the Presidential Academy, told Izvestia. Loans under this program are issued at 6% per annum, and it accounts for about 88% of all government-subsidized mortgages.
If we look more broadly, preferential programs in general today account for about 78% of all mortgage loans, he noted. It follows from this that the family mortgage alone provides about 69% of the total volume of loans, that is, it actually exceeds two thirds of the market. In fact, this is the key and most widespread support mechanism, and at the same time the most financially capacious for the budget, since it requires banks to compensate for the difference between the market and preferential rates.
— At the same time, family mortgages work in two directions at once: on the one hand, they support the construction sector so that the market does not stop and demand remains, on the other, they are initially designed to support families with children, — said Alexey Voylukov.
However, it has long been estimated that in its current form, the family mortgage does not fully solve the demographic problems of the state. The fact is that it is provided to almost any family with at least one child, that is, in fact, almost any family with children.
— The proposed reform is aimed at more tightly linking family mortgages to the demographic priorities of the state. The key idea is to introduce differentiated rates: the more children there are, the lower the percentage," the expert explained. — This should reduce the burden on large families or allow them to purchase more spacious housing, as well as reduce budget expenditures on subsidizing the program, which in recent years has become widespread for families with one child.
The program will remain preferential for such families, but the conditions are likely to become less attractive, he said. The parameters are still being discussed, and final decisions are expected in January and February. According to preliminary estimates, the rate for families with one child may rise to about 12% per annum, for two children it may remain at 6%, and for three it may decrease to 4%. Despite the growth, such conditions will still be significantly more profitable than a market mortgage.
At the same time, the introduction of new rules will not be a problem for banks. Similar changes have been worked out in practice more than once.
— The housing market will face multidirectional effects: demand from families with one child may decrease, while interest from those with many children, on the contrary, will increase. In general, the volume of preferential mortgages may decrease slightly, especially since, against the background of monetary policy easing, a gradual decrease in rates on market mortgage products is expected," said Alexey Voilukov.
Izvestia sent a request to the Ministry of Construction and the Central Bank, but no responses had been received at the time of publication.
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