Mortgages as a Government Contract: Who Determines Demand? Forbes Development Roundup

A panel discussion on the “eOselya” program and the future of Ukraine’s mortgage market took place at the Forbes Development Forum. The discussion was moderated by Anna Laevska, CEO of the developer Sigma+. Speakers included Yaroslava Avramenko, Deputy Chair of the Board at Ukrfinzhytlo; Vitaliy Petruk, Deputy Minister of Economy, Environment, and Agriculture; Oleksandr Shcherbaha, Deputy Chair of the Board at Ukrgazbank; and Olena Ryzhova, Commercial Director at Intergal-Bud.

"eOselya": What Has Been Done So Far

Over the course of three and a half years of the “eOselya” program, nearly 26,500 loans totaling 46 billion hryvnias have been issued. By comparison, in the best pre-war year, the entire banking system issued a total of about 8,000 mortgage loans.

“Nearly half of all borrowers are military personnel. The people who help us live in our country can afford housing through our program,” said Yaroslava Avramenko.

More than 60% of loans are directed toward the primary market—that is, people are buying new apartments directly from developers rather than on the secondary market. This is important for the real estate development industry: the program effectively stimulates demand specifically for new construction.

The quality of the loan portfolio is particularly impressive. NPL refers to the percentage of non-performing loans—that is, loans where the borrower has stopped making payments. In typical lending programs, this figure can reach several percent. At “eOselya,” it is close to zero.

Changes to the program's terms have hurt demand

In February 2026, the program’s terms changed significantly—particularly with regard to the size and cost of the apartments. The market felt the impact immediately. Olena Ryzhova explained that while the number of applications did not decrease, their composition changed.

“Due to the new restrictions, there has been an increase in the number of inquiries about one-bedroom apartments—people simply cannot afford to pay the extra cost for a two-bedroom apartment. Unfortunately, developers do not have any two-bedroom apartments with an area of up to 57 square meters available—due to DBN regulations.”

In addition, it is no longer possible to purchase renovated apartments under the program. Buyers are either switching to the banks’ partner programs or opting for long-term installment plans offered by developers.

Yaroslava Avramenko confirmed that the market's position had been heard: 

“We conducted a survey through Diya and found that borrowers are literally short by 8 square meters. Changes will be adopted in the near future. We also plan to include veterans in the preferential category—those who can obtain a loan at 3%.”

The government is looking for new sources of funding, while banks are seeking transparency

This year, the government will make its final capital injection into “Ukrfinzhytlo”—15 billion hryvnias. Going forward, the program is expected to be scaled up using other sources of funding. Vitaliy Petruk explained:

“Currently, ‘Ukrfinzhytlo’ covers 97% of the mortgage—and that’s just one source: the state budget. It’s a limited resource. That’s why we’re negotiating with the World Bank and the EBRD regarding interest rate subsidies to bring the banking sector into the process. For every hryvnia from the state, there should be two hryvnias from the bank.”

Oleksandr Shcherbaha said that Ukrgasbank ranks second in the system in terms of the volume of loans issued under the “e-Oselya” program, and outlined the main barriers to more active participation by banks in the program.

“Today, credit and reputational risk fall entirely on the banks—and it’s often beyond our control. We see situations where the land is registered under one legal entity, the developer is another, and the bank bears all the risks. The experience of Poland and Kazakhstan shows how it’s possible to work through escrow accounts, where funding is disbursed in tranches. This would allow us to develop this market more actively.”

He also said that the bank is preparing to fully digitize the mortgage process—a memorandum between Ukrgazbank, “Ukrfinzhytlo,” and Mastercard has already been signed.

The participants in the discussion reached a consensus that “yeOselya” is the undisputed driver of demand—it accounts for 15 to 40 percent of various developers’ sales. However, the market is waiting for concrete steps to be taken.

“Developers are expecting concrete action: programs to compensate banks for part of the interest rate, and the option to use housing vouchers as a down payment under the ‘eOselya’ program. People are already reserving apartments and waiting for this to become legally possible,” concluded Olena Ryzhova.