Practical application of project financing of housing construction in Russian Federation

The existing high demand for real estate assets and the negative growth of construction during recent years have made housing construction one of the development priorities of the Russian national economy (Asaul et al. 2019). In view of this, a whole range of legislative and program initiatives intended to improve the efficiency and extension of housing construction financing sources have been developed at the federal level. Until recently, the use of citizens’ funds under shared construction contracts has been the most common method of financing, which caused the appearance of a new category of citizens, so-called “hoodwinked investors”. However, the construction industry underwent a number of dramatic changes in 2019. The main one was the transition to project financing of housing construction, which became obligatory for all players in the housing construction market. The goal of this article is to analyze and assess the implications of the transition to project financing in the area of housing construction. Based on the research results, the author distinguishes a number of features typical of the Russian model of project financing.

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