What obstructs mortgage development? Cabinet has no answer

The Russian Government is going to find out what obstructs the development of mortgage in the country, Prime Minister Mikhail Kasyanov said at a cabinet meeting.

"Merely 5% of mortgage have been provided through the mortgage lending agency, but it is a small element of housing construction - the extent of mortgage lending is far below the commissioned housing," Kasyanov pointed out. In his view, the government is to find out where the problem lies.

"The problem is neither in the financing component nor in the lack of funds - funds have been available over the four years of stable economic development. We are to find out why the banks give no or few mortgages for housing," Kasyanov said.

At present, he went on, citizens themselves credit housing builders, in this way replacing the bank sector. We must find out where the stumbling block is - legal or economic aspects - and to engage mortgage lending into play, the Prime Minister added.