The authorities are making concessions to banks and developers


September turned out to be very fruitful for good news for developers, who from the very beginning of the housing system reform are struggling with varying success for any concessions as part of the transition to a too tough, in the opinion of business, model for financing development projects. Particularly worried about the business terms of loans in the framework of project financing. After all, to force banks to lend at low interest is impossible. And in the first month of autumn, the authorities made concrete decisions on this issue – with the participation of the uniform development institute in the housing sector (DOM.RF), the implementation of a program to guarantee loans to developers began.

It should be noted that the fundamental changes in the developer market, which began with the now familiar terms of escrow accounts and project financing, were immediately perceived by most developers, to put it mildly, without enthusiasm. The prospect of losing free access to equity holders, additional financial burden and total banking control in a difficult economic situation means for developers a decline in profits amid the projected fall in effective demand. From the very beginning, the construction lobby has been active in the interests of developers, but entrepreneurs have begun to receive a consistent and concrete response to their initiatives in recent times.

By a combination of factors

There can be several reasons for such a change in a situation or their combination. As you know, in May, the head of the Ministry of Construction of Russia changed (Vladimir Yakushev came to replace Mikhail Me), and a little earlier, Deputy Prime Minister Vitaly Mutko was appointed as the supervisor of the Construction Complex. Perhaps the fact is that even experienced officials took time to dive into the realities of the development market. At the same time, Vladimir Yakushev, from the very beginning, outlined his position – not to give developers a grudge. At the same time, in order to build a clear, legislatively supported position, both the minister and the new construction supervisor needed to sort out all the nuances. There is another possible reason – the statistics of Rosstat. According to the ministry, in January-August 2018, 39.2 million square meters were commissioned in Russia. meters of housing, which is 1.1% less than in the same period of 2017. In August, the decline in housing construction was 17%. How can one fail to recall the task set in the May decrees of the Russian President to increase the volume of annual housing construction by 12024 to 120 million squares per year.

It should be noted that at the beginning of September, the one who got the status according to the status of the construction business finally stood up – Boris Titov, authorized by the President of the Russian Federation to protect the rights of entrepreneurs. Moreover, the Ombudsman did it very elegantly, putting in the forefront the interests of citizens, the completion of whose houses had stalled due to amendments to the Law on shared construction.


In the appeal of Titov, in particular, it was noted that, according to the results of the first half of 2018, there were 880 such unfinished residential properties in Russia, on which 90617 equity participation agreements were concluded. More than 200 thousand people are entered in the federal register of affected citizens and the registers of the subjects of the Russian Federation. Some of these objects as social burden under contracts with regional and municipal authorities were taken by developers, who attract funds from real estate investors for the implementation of their own projects.

However, as the ombudsman wrote, the new edition of Part 1 of Article 18 of Law No. 214-FZ (adopted by the law of July 1, 2018 No. 175-FZ), from September 1, 2018, obliges the developer to finance shared construction objects exclusively through special accounts and prohibits the use of funds companies for other purposes. That is, the developer cannot use the funds (both own and credit) to complete the construction of “problem objects”. These funds can only be spent on the construction of the company’s own apartment buildings, as well as the accompanying expenses. According to this provision, in the event a payment order is received from a construction organization, the authorized bank will have to refuse to carry out the operation and notify the Fund for the protection of real estate investors, which will result in suspension of the construction company, as well as administrative and even criminal liability. Thus, Titov emphasized, in fact, from September 1, 2018, the construction of “problem” objects of unfinished housing construction was stopped. This, in his opinion, can lead to an increase in social tension among the already repeatedly affected equity holders.

The reason for this situation, as stated in the appeal, was the extension of Article 18 of Law No. 214-FZ to developers who received construction permission before July 1, 2018. What is unreasonable, since for the existing objects of shared construction, funds are already being contributed to the Fund for the protection of real estate investors, and, therefore, these objects are insured. Titov particularly stressed that the said amendments (parts 7–8 of Article 8 of the Federal Law of July 1, 2018 No. 175-FZ), introduced by the State Duma deputies, did not receive an official conclusion of the Russian government. The letter also stated that the Fund for the Protection of Shareholders was not authorized to spend money on objects whose construction problems began before its establishment (that is, before October 20, 2017). “Thus, resolving the issue of“ problematic ”apartment buildings is not possible by other means than preserving the previous model of attracting other construction companies for completion,” the ombudsman wrote in conclusion, asking for a working meeting on this issue under the supervision of the deputy prime minister.

The answer to the business request was the same working meeting with the vice-premier, which substantively discussed the possibility of allowing the stage-by-stage defrosting of equity holders’ funds from escrow accounts as construction projects are ready. The corresponding change can be made to the State Duma in the autumn session during the next revision of amendments to the legislation on shared construction. At the meeting, other concessions to developers were also discussed, the essence of which became known later. In particular, it was reported that from April 1, 2019, preferential accrual of reserves for bank loans to developers and for calculating the risk ratio for these loans will be introduced if citizens ’funds are raised through the escrow account mechanism.

Guaranteed mechanism

Another measure to reduce the credit burden on developers will be to establish a preferential risk-weight for loans to developers with a guarantee (guarantee) DOM.RF. This topic has already received a specific continuation – DOM.RF has signed cooperation agreements with Sberbank and Gazprombank, under which it is planned to jointly develop a mechanism that will allow state-owned companies to provide guarantees to banks that provide targeted loans to finance housing construction. For such loans, a lower risk-to-weight ratio of 20% instead of 100% is envisaged. In the near future DOM.RF will determine the basic conditions of the guarantee, the requirements for developers and projects under the mechanism. Pilot transactions to guarantee loans to developers are planned to be conducted in the first half of 2019.


CEO DOM.RF Alexander Plutnik:

“The mechanism of escrow accounts will allow transferring risks from home buyers to developers and banks and reduce the burden on federal and regional budgets, due to which objects abandoned by developers are being completed. However, to achieve an input of 120 million square meters. meters per year in the context of the ban on direct attraction of citizens ‘funds, a number of regulatory changes should occur, reducing the pressure on banks’ capital. Among such measures, a guarantee or an independent guarantee for authorized developers of banks for lending … According to our calculations, the rise in housing prices from switching to the model of escrow accounts can be 2-2.5. Reducing the availability of housing for citizens will not happen”

Deputy General Director DOM.RF Artem Fedorko is confident that the use of the guarantee mechanism will allow the banking system to multiply increase the volume of housing loans, and medium-sized banks to participate in the implementation of large-scale integrated development projects, ensuring a smooth transition to the industry’s financing model. “In the medium term, to fully replace the funds of co-investors, growth in the volume of project financing of housing construction is required by 7 times: from 0.6 to 4.3 trillion rubles. We believe that up to half of this volume can be implemented using the new mechanism, ”he concluded.


The amount of funds attracted to housing construction in the country is currently estimated at 4.7 trillion rubles, of which 3.7 trillion rubles are citizens’ funds and 600 billion rubles are credit funds. Banks consider housing to be a high-risk segment. In addition, the Bank of Russia has introduced fairly stringent standards for lending to developers.

Source: “Construction newspaper”