Is it Possible for Small Towns to Survive?

On behalf of President Putin, the Government has allocated 500 million rubles for subsidizing loans for construction companies that build housing in small towns (Order No.2524-r dated September 12, 2025).

This is only for the current year. In 2025, companies that are building 390,000 square meters of housing and plan to complete it the following year will be eligible for preferential loans. In 2026-2027, an additional 1.1 billion rubles is planned to be allocated for these purposes.

The issue of supporting the housing construction segment in small settlements (up to 100,000 residents) was discussed at the April Presidium of the State Council on the development of infrastructure for living. There, the President issued an order to open a program for subsidizing the commercial loan rate for construction companies, so that they can complete housing construction on time and citizens can receive their long-awaited housing.

We are talking about developers who work under the project financing mechanism for housing construction. Thanks to federal funds, they will be provided with preferential loans at a 12% annual interest rate. To do this, they need to have a project for building new housing in cities or settlements with a population of up to 100,000 people, and they must use escrow accounts to attract funds from shareholders.

This is good news.

First, despite the Finance Ministry’s opposition, Mishustin’s government continues to expand areas of budget support where there is a risk of significant infringement on citizens’ interests.

Second, we can confirm that the government still has a focus on “horizontal” settlement throughout Russia, rather than concentrating the population in 15 megacities.

Additionally, it would be beneficial to halt the ongoing closure of hospitals and schools in small towns as part of the ongoing optimization reforms in healthcare and education.

And to give people a normal job by setting up small modular production facilities there, and in some areas by employing people in the forestry sector, for example, where, as a result of (another) optimization (the 2006 Forest Code), there is now a severe shortage of forest rangers and other forest workers.