Russia subsidizes large-scale housing construction in occupied Ukraine

Russian companies are utilizing state subsidies to develop over 1.3 million square meters of residential space across occupied Ukrainian territories, including Kherson, Zaporizhzhia, Luhansk, and Donetsk. According to investigations, these developers benefit from significant government support, such as tax exemptions, low-cost land, and construction loans with interest rates near 3 percent. Additionally, the Russian government is incentivizing buyers with mortgages at rates as low as 2 percent.

Mariupol has emerged as a primary hub for this construction surge following its 2022 siege. Public banks have reportedly issued at least 61.4 billion rubles (approximately 610 million euros) in loans for new housing in the city, a move that could generate profits exceeding 18 billion rubles (180 million euros) for developers.

This expansion is facilitated by the seizure of Ukrainian properties. Reports indicate that since the beginning of 2024, occupation authorities have seized or marked for seizure more than 34,000 Ukrainian properties, with over 14,000 of those located in Mariupol alone. While developers profit, original residents whose homes were destroyed face significant difficulties in obtaining fair compensation or replacement housing.