THE "GUARD" OF DECEIVED SHAREHOLDERS WILL NO LONGER EXIST?

Sergei Mardan, host of Radio KP:
- I would suggest first assessing the results of the first year of the industry's transition to project financing and escrow accounts. Russia has come a long way in unpleasant scandals and proceedings with deceived shareholders. A new model has been introduced so that these difficult stories do not repeat themselves. How are we doing?

Vladimir Yakushev:
- Unfortunately, despite the fact that quite a large number of housing was built under the equity construction scheme (according to our estimates, 500 million square meters), and most of them were decent developers, we have a whole guard of people who did not get their apartments. This is why the President set a task to deal with this problem and to make sure that the money of citizens is protected. Now the citizen does not carry the money directly to the developer, but puts it in a bank, in a so-called escrow account. The developer takes a loan from the bank and on this credit line he builds a house. And only after the ownership of the housing is formalized, escrow accounts are disclosed and the money from the account of the citizen is transferred to the developer. That's the bank protection.
The Minister of Construction: We want to simplify all procedures to build for a year, not 4.

Sergei Mardan:
- When they introduced the system of escrow accounts, there were many articles, talks about the fact that small construction companies will not survive this new system.

Vladimir Yakushev:
- The transition to project financing was very tense. And actually it still goes today. Some projects are being completed according to the old rules. These projects have been specially selected. There was a government decree, what requirements they should meet in order to be financed according to the old rules. But the number of projects, which are already being built according to the new rules, exceeds 30%. And then the houses will be completed according to the old rules, and the developers will stop working according to the old rules. All new projects - only according to the new rules, through project financing and through escrow accounts.
As for the companies, which today have problems with obtaining project financing. We do not have a small, let's say, number of Russian regions, where consumer demand is limited. Whatever the cost of construction is today, it is impossible to sell more expensive than the borders of consumer demand in this or that region of the Russian Federation. And banks do not consider projects with low margins below 15%, they see this as a threat that the money will not be returned. For housing construction to continue in such regions of the Russian Federation, certain support measures are needed. This topic was discussed at one of the meetings with the head of state. And recently the order of the Prime Minister was issued, according to which such projects will be supported in the regions.
If it is a decent developer, it meets all the requirements of project financing, does not meet only one requirement - a margin between cost and sale price of less than 15% - state support is included so that this company could receive project financing.

"HISTORIC CHANCE" TO SOLVE THE HOUSING PROBLEM

Elena Arakelyan, journalist of "KP":
- The President recently stated that today we have a historic chance to solve the housing issue in a fundamental way. We have already been promised something - each family has its own apartment and affordable housing... What are the chances that now we will be able to deal with the housing issue in a different way? How will we solve it?

Vladimir Yakushev:
- This problem is of a complex nature. It is not only the work of the Ministry of Construction and not only those issues that we directly administer. You and I understand very well that in order for a family to be able to buy new housing, they must have a certain income. Therefore, when the President set such a task, he spoke about real incomes of the population, about how they should grow. And you know that this is one of the main tasks today, which was set in the presidential decree, respectively, then expanded in national projects.
There is a whole complex of problems. The economy has to grow. The growth of the economy gives growth of real incomes of citizens. Accordingly, when real incomes of citizens grow, a citizen can afford to buy housing. And a citizen should not only be able to buy housing, he should be able to choose. That is to say, not to buy a cage of incomprehensible value, but really to be able to choose for their money. Today, citizens not only buy square meters, they buy the environment. It is important for us today that we have a good entrance, a landscaped yard. We'd like to go somewhere else, have coffee. And that somewhere nearby there's a bank, shops and so on. For all this to happen, of course, we need an increase in real incomes and, of course, a functioning economy.
The second point is the work of the construction industry itself, which should give citizens the choice and opportunity to buy the housing they want. Yes, this apartment may be small, but it can be cozy, comfortable, in a good neighborhood, with good transport accessibility, with a good yard, and a well-appointed environment around it. And the citizen will then be satisfied with what he got.

WHAT HAPPENS NEXT WITH A PREFERENTIAL MORTGAGE

Maria Bachenina, the host:
- Vladimir Vladimirovich, how effective was the preferential mortgage program at 6.5% in the current situation? And I cannot but ask - should we expect even lower rates, which we all certainly hope for?

Vladimir Yakushev:
- Let's start with the rate. We now have a historically low rate set by the Central Bank - 4.5%. Further on, everything will depend on how our macroeconomics will work, that is, the overall economic situation. How our productivity will grow. All this will directly affect the key rate set by the Central Bank.
As for the preferential mortgage at 6.5%. This measure proved to be very effective and very timely. We have a few demand issues, let's say, due to the limitations of the coronavirus. These restrictions have to be divided into two parts. The first part - when someone wanted to buy an apartment, but could not, because some services did not work, it was not always possible to come and see the apartment. There were transactions that took place online, but let's just say it wasn't in the flow.
The second point is what we experienced during this period, a lot of information, constant news about the economy not feeling very well, etc. Many people were thinking about what to do with the savings that seemed to be in the apartment. Maybe it is better to leave these savings for a rainy day.
A 6.5% stake in a lot of people made them buy. Because we've never really had a mortgage rate like that. I'll give you some numbers. This program started on April 20. The banks received 295,000 applications, 254.5 of which were considered and 197 approved. It's a very high approval rate, you'll notice. And today, 182 billion rubles worth of credits have already been issued. That is, a quarter of the planned limit is already almost in the works. In recent years, there has been no other such effective program to support housing construction. Therefore it is unequivocally the effective program.
There is a discussion on extension of this program at the government site. There is even a discussion about whether or not the interest rate will be lowered. We will see how things will develop, we will see what will happen to our macroeconomic indicators. We will look at what will happen to the demand in the market in general, we will analyze all this. Depending on this, I think, a government decision will be made, with which we will go to the President with a report, and the fate of this program will be determined in the future.

WHAT MAKES IT HARD TO GET A CHEAPER PLACE TO LIVE

Sergei Mardan:
- At this meeting, where he spoke about the historical chance to solve the housing problem, the President mentioned the mandatory simplification of the SNiPs. Tell us about it. To what extent does it restrain the industry, and to what extent will simplification of this history give an additional impetus to construction?

Vladimir Yakushev:
- The codes of conduct, the SNiPs, the State Standards are all the regulatory and technical documents that we are building on today. You and I cannot make a doorway or a staircase as wide as we want. There are normative and technical documents that prescribe how it should be in a particular room. So all the construction is going according to the rules, otherwise the safety issue would be much more serious than it is today.
But these standards according to which construction should go today, long enough years, especially in the post-Soviet period, were not updated and not actualized. In the dashing 90s, this topic was simply forgotten. And a certain period of time was lost, normative and technical documents lagged behind. Conditionally, our colleagues in the Western countries and in other countries where construction was actively developing, already live in the fifth generation, now we need to jump from the second generation to the fifth. And do it quickly enough, if we want to have new modern housing.
That is why we have almost all normative and technical documents in our national project passport till 2024 - and their number is written there by years - should be updated, some should die, because they are already outdated and new ones have been written.

Sergei Mardan:
- Will it have no impact on safety?

Vladimir Yakushev:
- Definitely it will not affect safety. Believe me, the procedure for the adoption of a certain normative and technical document is very strict, and before the adoption of a set of rules, there are serious tests, scientific research, and only after that corrections are made. A large number of people who do this are professionals and they are personally responsible, right down to the criminal level, for the appearance of such documents.

Elena Arakelyan:
- Continuing the theme of the SNiPs. What prevents us from building cheaper housing in general? We have many citizens who are sure that developers sit on bags with money, get fabulous extra profits and only their greed prevents them from building affordable housing. Administrative barriers are often mentioned. What are we talking about?

Vladimir Yakushev:
- Everything about administrative barriers is true, they are still quite significant. It takes us 4 years from the moment you make a decision to build a certain object to its commissioning. That is why today we have set a task to prepare the entire regulatory framework by the end of this year so that this period could be reduced by one year. Because the longer we build, the more expensive the construction is - inflation, costs, salaries, etc. Who will pay for this later? The consumer will pay for it, because it will all fall on the cost per square meter. Plus the bank interest. So we use the money, we haven't finished the apartments yet, we haven't opened escrow accounts, we pay interest to the bank, so where does it all go again? It's included in the cost per square meter. So the less time we use the borrowed money, the less the cost per square meter. These are all the moments we also have under control, we're working on it.
And there is also the land issue, as always, one of the main issues in Russia. This is all about the allocation of land, the granting of land plots. Today, there are not so many of them, where there is at least some infrastructure. That's why the infrastructure today is expensive. And this is another point where we can seriously reduce the cost of construction.
There must be support from the budget, development institutions must work more actively to ensure that infrastructure is as expensive as possible per square meter.

HOW HOME CONSTRUCTION HAS SURVIVED THE PANDEMIC

Maria Bachenina:
- The construction sector received quite serious support from the state during the pandemic. Did it help?

Vladimir Yakushev:
- We have discussed one of the effective measures - subsidizing the interest rate on mortgages up to 6.5. Another mechanism is working - subsidizing the interest rate on loans taken by developers. And this is support for a difficult period for our developers - 20-21 years. There are a number of conditions there: that they do not reduce the number of workers, they must introduce all the objects in time, which they planned for 20-21 years.
12 billion rubles from the federal budget has been allocated for such support. An interdepartmental commission for the selection of projects is working under the Ministry of Construction, and the interest rate will be subsidized.

Maria Bachenina:
- And if the construction of housing in the country rises, then what happens to the economy? How many people will be unemployed if we do not even take into account migrants? What other industries can stand up?

Vladimir Yakushev:
- I think that will not happen for sure. According to the estimates we have today, we have about 6 million people working directly on the construction site. We are talking not only about housing construction, but also about civil construction. And, again, according to generally accepted estimates, there are about 6-8 people working in other sectors of the economy behind each one of those working on the construction site. This is why, of course, the head of state said it clearly, the construction industry is an important branch of economy. It is the locomotive of our economy. Everything that is related to investments today is related to construction. And if, as you say, construction stops here, well, life has practically stopped. We stop investing, and if we stop investing, we just degrade with you.

ABOUT 12 MILLION AND HOUSING FOR RENT

Maria Bachenina:
- Vladimir Vladimirovich, a phone call from Nadezhda from Moscow.

Nadezhda:
- Good evening! At the last conference Vladimir Putin spoke about the decree he issued on state support, where for Moscow, St. Petersburg and the Moscow region will be preferential 6% on mortgage if the loan for an apartment - no more than 8 million. He said that this amount will be expanded to 12 million. The situation in the market is such that, let's say, I can't find a two-bedroom apartment for a family in Moscow for 8 million now. And so far, no action has been taken to expand the amount. Will there be a change in the decree? Will there be an expansion of this amount to 12 million in Moscow and the region?

Vladimir Yakushev:
- There will be an expansion. It will not be a presidential decree, the government has been instructed, it will adopt the necessary resolution.

Maria Bachenina:
- How long will we wait?

Vladimir Yakushev:
- Everything is about to happen.

Maria Bachenina:
- A curious question came to the youtube: why isn't South Korea's experience used in Russia? More than 70% of people there do not have their own housing, everyone rents apartments. Conditions: you pay a deposit and only pay taxes. And you live to your old age.

Vladimir Yakushev:
- We study the experience of other countries, see what and how. But people from us, first of all, want to buy housing. Probably, this is primarily due to our mentality. Because we only feel confident when we own a home. So we exchanged information with each other before the transfer. And you asked the question: who has their own house?

Maria Bachenina:
- And you did not answer, Vladimir Vladimirovich, about your Moscow situation.

Vladimir Yakushev:
- I have housing in social rent. When I was invited to work in the government, I was provided with housing. I think the situation is normal.
Young people, the new generation, their mentality is changing. They no longer want to be tied to property. They want to move around easily: if they gave me a job in another city, moved, rented a place to live and live in a comfortable environment.
I think that the new generation will have a demand for new mechanisms. We have to develop them and deal with them, definitely. But everything just has to go in an evolutionary way.


Source: minstroyrf.gov.ru