Russia is winding down a costly program of mortgage subsidies that has fuelled a property boom in the face of the COVID-19 pandemic and the war in Ukraine.

The program provided mortgages at 8 per cent interest even as the Bank of Russia has increased the base rate to twice that level to battle accelerating inflation. It prompted criticism from Governor Elvira Nabiullina about the distorting effect of the subsidies for newly built properties that drove up prices, enriched developers and brought housing affordability to multi-year lows.

Bloomberg