Bank of Russia warns about risks of instalment plans offered by developers when selling housing

According to the survey of major developers, instalment plans were one of the key payment methods in 2025 Q1. Their share in the transactions to buy/sell new builds approached 40% in 2025, while it was below 10–20% in previous years. Accumulated outstanding amounts under instalment plans have reached ₽1 trillion. As developers typically do not assess buyers’ solvency when offering them instalment plans, the rising popularity of this practice increases the risks of households’ over-indebtedness. People may face a bank’s refusal to provide a mortgage loan or difficulties in servicing their loans. Instalment sales often imply inflated housing prices. As a result, people may incur financial losses if they decide to sell their new build homes in the secondary market.

When buying housing in instalments, households are running higher risks than mortgage borrowers. For example, they cannot use loan repayment holidays as well as other government support measures to repay part of their instalments. Apart from consumer risks, there are risks to both developers themselves and the banking system. These risks are due to the fact that a buyer may refuse or be unable to repay instalments under the instalment agreement. The Bank of Russia’s document aims at mitigating risks associated with this practice.