Demand for mortgage refinancing grows in banks
Russian homeowners rushed to refinance mortgages in the third quarter of 2025 as rates dropped sharply. The surge came after the Central Bank slashed its key rate five times this year. Borrowers now face significantly lower monthly payments and reduced overpayment costs compared to earlier in 2025.
From July to September, refinancing requests averaged seven times more per month than at the start of the year. Applications for mortgage refinancing alone jumped by 40% in the third quarter. Major lenders like Novikom Bank and Dom.RF reported a threefold increase in such requests.
The Central Bank’s rate cuts—from 21% to 16%—drove market mortgage rates down from 28.5% in early 2025 to 21.2% by November. Refinancing now reduces monthly payments by about 25% and cuts total loan overpayment by a third. Overpayment ratios have fallen from 470% to 324% since January. Meanwhile, housing prices continued to diverge. In the Central Federal District, new builds now cost nearly 300,000 rubles per square metre—84% higher than secondary market prices. Nationally, the gap between new and resale housing reached 61%. No specific data, however, confirms which banks raised refinancing rates in Q3 2025.
The refinancing boom follows a year of steep rate reductions and rising housing costs. Borrowers benefit from lower payments, while lenders process record numbers of applications. The trend reflects broader shifts in Russia’s mortgage market as affordability improves.
