Russia will prolong discounted mortgages at 6% interest for families with two or more children to at least 2024, RIA Novosti reported citing the office of the deputy PM Tatyana Golikova.

The mortgage interest rates continue a stable downward trend that is fuelling the recovery of residential real estate market in April 2018 dropping by 2.01pp to 9.68% as compared to 2017. In addition to the overall lowering of interest rates in Russia, in the end of 2017 the government has adopted a program of subsidy-discounted mortgages for large families. Previously the government subsidised all mortgages with rates over 12% to boost construction and promote homeownership. Now the tool is being used in a more targeted fashion to support specific social economic groups like families with lots of children.

The discounted mortgages have now also reportedly been added to the demographics national programme, which was proposed by President Vladimir Putin in 2017 to encourage Russians to have more children.

Previously Golikova, who is in charge of social policy in government,  told RIA Novosti that in 2018 over RUB2bn discounted family mortgages have been granted. RUB5.9bn have been budgeted for the initiative in 2018, RUB9.2bn in 2019, and RUB11.5bn for 2020. The number of banks participating in the programme needs to quintuple by 2024.

So far in Russia the biggest five banks account for eight out of ten rubles lent to home buyers, driving most of the mortgage segment that was up by over 80% in the first four months of this year.