Private houses will be built only using escrow accounts in Russia

From March 1, private houses in Russia will be built only using escrow accounts. This law protects people from unscrupulous contractors: the developer will receive payment only after registering the house ownership. The customer will get the money back if the construction is not completed.

As the Central Bank explained, escrow accounts will be opened only in banks with a sufficient credit rating, and the money in them will be insured up to 10 million rubles.

Citizens can refuse to continue building a private house and return the money from the escrow account if they pay the contractor for the materials and work.

Funds from the preferential "family mortgage" can be used to build a private house through escrow.

Under the new rules, contractors must publish information about their company, their private home projects with the estimated cost and timeframes, and the bank where the escrow account is opened in the Unified Housing Construction Information System.

Author: Elina Akhmetova