In densely populated countries like the Netherlands or Singapore, owning a house with a plot of land is often perceived as an unattainable dream. However, in Russia, land is generally much more affordable, and with careful planning, one can enjoy an exceptionally high standard of living for less than the cost of an apartment in many other countries.
On This Page
Which house would you like to build?
7 categories of land in Russia
On which plot can you build a cottage or a residential house?
Individual housing construction (IHC)
Documents to begin construction
How to submit a notice of the start of construction
Documents after the completion of construction
If you decide to build a large house
Personal subsidiary farming (PSF)
Significant difference between PSF and IHC
Conversion of a plot from PSF to IHC
What Kind Of House Would You Like To Build?
Before you start looking for a plot of land, it’s important to determine how you plan to use it. Are you planning to live there permanently, or just visit on weekends in the summer? Do you want to raise small livestock or poultry? Or perhaps you’re interested in active gardening?
Land Designation
The designation of a land plot directly affects its cost and permitted use.
So, if you’ve decided to build a summer house or a country home for permanent residence, the first step is to decide what kind of land designation fits your purpose.
The land designation is listed in the Unified State Register of Real Estate (USRN) and determines its possible uses.
7 Types of Land Designations in Russia
Agricultural Land
This category includes land located outside of settlements and intended for agricultural production.
Such land is used to grow agricultural products, graze animals, and grow feed for them.
As we wrote in the article “Restrictions on foreign citizens purchasing land plots in Russia,” there are restrictions on foreign ownership of this type of land.
Land of Populated Areas
These are lands located within the boundaries of towns and settlements. They are primarily intended for the development and construction of these populated areas.
A populated area is a place inhabited by people (a settlement). A key characteristic of a populated area is its continuous use as a place of residence year after year. In Russia, there is no legal distinction between different types of populated areas based on population size or development. However, the main criterion distinguishing a rural settlement from an urban one is that the majority of the economically active population in urban settlements is not employed in agriculture. As a result, some villages and towns in Russia are larger than cities.
Examples of populated areas include:
- Cities (e.g., Moscow, St. Petersburg)
- Urban-type settlements (work, resort, summer, and town settlements). These are located in the regions of large cities. The largest urban-type settlement in the Leningrad Region is Yanino-1 (19,714 people in 2023), followed by Roshchino, the second largest urban-type settlement.
- Rural settlements (villages, hamlets, stanitsas, small villages, farmsteads). Most of the largest rural settlements are located in southern Russia, in regions with the most favorable agro-climatic resources, which have shaped a large settlement system. The largest village in Russia is Novaya Usman, a suburban settlement of Voronezh.
On this type of land, you will find:
- residential buildings of various heights (individual and multi-apartment buildings);
- summer houses and garden houses;
- production facilities;
- office buildings;
- social and cultural facilities, and other objects necessary to meet the needs of the population.
Industrial Land
Industrial lands include plots allocated for the placement and operation of enterprises in industries such as metallurgy, chemical production, manufacturing, mining, and other industrial sectors. In other words, these lands are occupied by factories, plants, mines, quarries, and other mining operations.
Such land is located outside populated areas and is used or designated for ensuring the operation of organizations and/or the exploitation of industrial facilities.
In Russia, there are many factories located on industrial land. Here are a few examples of such factories:
- AvtoVAZ (Togliatti, Samara Region) – one of the largest automobile factories in Russia, manufacturer of LADA cars.
- KamAZ (Naberezhnye Chelny, Tatarstan) – the largest manufacturer of trucks, buses, and special machinery in Russia.
Land Of Specially Protected Areas And Objects
These are lands withdrawn from circulation by the state and placed under state protection and control. Such lands hold special value: environmental, including water protection, scientific, cultural-historical, aesthetic, recreational, health-related, or other.
Lands of the Forest Fund
Land covered or not covered by forest vegetation, primarily intended for forest management (Article 101 of the Land Code of the Russian Federation).
The composition of forest fund lands consists of two large groups:
- Forest lands. Covered or not covered by forests, these are intended for forest regeneration.
- Non-forest lands. Not covered by forests, these are occupied by firebreaks, clearings, reclamation systems, agricultural lands, forest roads.
In the Russian Federation, the forest fund covers about 69% of the entire territory.
Lands of the Water Fund
Land occupied by water bodies, glaciers, swamps (except in tundra and forest-tundra zones), hydraulic and other water management facilities;
land allocated for exclusion zones along water bodies, major inter-farm canals, and collectors.
Reserve Land
These are plots in state or municipal ownership that have not been transferred to citizens or legal entities, with the exception of land included in the redistribution fund.
On Which Plot Of Land Can You Build a Summer House Or Residential Home?
Private residential homes can be built on plots categorized as “Land of Populated Areas” and “Agricultural Land,” provided the designated land use permits it.
Designated Land Use
Designated land use refers to the legally approved purposes for which a piece of land and any existing or future structures on it can be used. It outlines the types of activities that are permitted on the property. This designation is also considered when calculating the land’s cadastral value and associated costs, such as land taxes or rental fees. For example, it plays a role in determining the amount of land tax or rent due for the property.
The land category and designated land use are not identical or interchangeable concepts. The former is broader in scope than the latter. Both criteria are important when selecting a plot of land and deserve special attention.
Let’s explore the main types of permitted uses that might interest us when choosing a plot for personal use.
Individual Housing Construction (IHC)
Individual housing construction refers to the construction of a residential home no higher than three stories for one family on a plot of land with an appropriate designation. It is suitable for permanent structures.
IHC is located on land designated as “Land of Populated Areas,” but since March 1, 2022, it is also permitted to build individual residential homes on agricultural land, but only if it is necessary for farming purposes.
On an IHC plot located in a populated area, you can:
- Live in the house year-round and register it as your primary residence;
- The municipality may provide utilities and access to services like hospitals, clinics, schools, and kindergartens.
- If the IHC plot is within a puplated area, under Federal Law No. 131-FZ (as amended on 29.12.2020) “On General Principles of Local Self-Government Organization in the Russian Federation,” local authorities must provide essential utilities: gas, water, electricity, and roads.
If a private residential plot is located within the boundaries of a populated area, then according to the law “On the General Principles of Local Self-Government Organization in the Russian Federation” dated 10/06/2003 N 131-FZ (as amended on 12/29/2020), local authorities are required to provide all necessary utilities: gas, water, electricity, and roads.
If the plot is located in a remote area away from the populated zone, utility services are provided only if the municipality’s budget allows it.
Banks offer loans for private residential plots through special mortgage programs. A house on a private residential plot can be built or purchased using various mortgage options, such as preferential, family, or IT mortgages, with interest rates ranging from 2% to 8%.
Typically, the down payment for these programs starts at 20% to 30%.
You can also apply for a mortgage for purchasing or building a home under standard programs. The interest rates for these loans are directly tied to the Central Bank’s key rate and are currently quite high. The average mortgage rate for purchasing a completed home is around 19.95% annually, while for home construction, it’s about 19.47%.
In the second half of 2024, Russia plans to launch a unified mortgage program for individual home construction.
Documents Required To Start Construction
You need to submit the following to the municipality:
- Notification of the start of work;
- Ownership documents for the land (extract from the USRN, as well as legal documents, such as a purchase agreement if you bought the property from another individual);
- An external description of the house — either in text or graphical form.
How to Submit a Notice of Construction Start
To approve the parameters of your future construction, you’ll need your ID and documents for the land plot, such as an extract from the Unified State Register of Real Estate (EGRN). You can submit the notice in paper form through a Multifunctional Center (MFC).
What To Include In the Notification
- Information about the developer (contractor): For individuals, provide full name, place of residence, and passport details. For legal entities, provide the organization’s name and address, registration number from the unified register, and tax ID (INN).
- Land plot data: Provide the address, cadastral number, permitted land use, and information about the owners, including legal documents (e.g., purchase agreement).
- Planned structure information: Indicate what type of house will be built (garden or residential), the purpose of the notification (construction or reconstruction), and the planned building parameters: area, number of floors, height, and setbacks from the boundaries of the plot.
- Schematic representation: Submit a schematic plan of the intended house, showing its exact location on the plot and the setbacks from the boundaries. This diagram can be drawn by hand.
Notification Review Time
The administration reviews the notification within seven business days (up to 20 business days for historic settlements). In response, you will receive a notification of compliance or non-compliance of your future home with the current standards and whether it can be built on the selected plot.
During this time, government officials will check your documents and the parameters of the future home against established standards. If you fail to provide any required information or documents, within three business days, your submission will be returned with an explanation. You will have the opportunity to gather the necessary paperwork and resubmit the notification. If everything is in order, the review process will begin.
What If You Receive a Non-compliance Notice?
If you receive such a document, it means your construction was not approved.
It’s important that the denial comes in writing and includes the reason for the rejection.
There could be several reasons:
- Setback violations, such as building closer than three meters from the property boundary;
- The size of the house does not meet the necessary requirements, such as exceeding three stories or being taller than 20 meters;
- The plot is not designated for building permanent structures, for example, due to an improper land use designation;
- The notice was submitted by someone other than the landowner;
- The house is planned to be built in a protected zone, such as near cultural heritage sites.
If the issue can be corrected, you can resubmit the notice.
If it cannot be resolved, you may need to abandon plans for building a permanent home or look for another plot of land.
No later than 30 days after completing the construction, you need to submit:
No later than 30 days after completing construction, you must submit the following:
- Notice of Construction Completion
The form for notifying about the completion of construction of a private residential home is identical to the form for starting construction, except for the title and the last page, where the SUIIP (the receipt number for the payment of the state fee for property registration) is recorded.
The site plan in the completion notice must exactly match the one provided in the construction start notice (the planning scheme in the construction permit). In other words, the house layout on the plot must be identical. - Technical Plan of the House
The technical plan, created by a cadastral engineer, is a document detailing the characteristics of the building. This plan is necessary for registering the house in the cadastral system and registering property rights in the Unified State Register of Real Estate (EGRN). - Agreement on Share Allocation for the House (if the land is jointly owned)
If the plot is in shared ownership, an agreement on the division of shares in the house must also be provided.
Once submitted, the applicant will receive a notification confirming that the constructed house meets legal requirements.
What if You Don’t Receive a Response from the Administration?
Russian legislation does not clearly regulate this process. In this case, we recommend acting based on your specific situation. If possible, visiting the Administration in person may help clarify the delay and speed up the process. Alternatively, you can send a letter requesting an explanation for the delayed or missing response to your submitted notices.
If You Decide To Build a Large House
If your house is over 500 square meters, you will need the following:
- Development of Project Documentation
The development of project documentation for construction is a complex process aimed at optimizing the building works. This process includes the following steps:
- Reviewing the results of geological surveys.
- Creating a preliminary design.
- Developing drawings, sections, roof plans, and more based on the preliminary design.
- Preparing a plan for utility networks and landscaping.
- Estimating costs and preparing a preliminary materials procurement plan.
- Defining technical conditions, including excavation, wall construction, welding, and more.
Occupancy Permit
The permit is issued based on the results of the expert review.
The average processing time for obtaining this permit is 3 to 6 months.
Construction Expertise
The project documentation must be reviewed by authorized institutions to ensure compliance with legal requirements and other standards. Currently, there are several options for this review: it can be done by state authorities or private experts. For private homes built for personal use, the expertise is typically conducted by private entities.
The average time for this process is 3 to 6 months.
Personal Subsidiary Farming (PSF)
Personal subsidiary farming (PSF) is similar to Individual Housing Construction (IHC) in terms of criteria.
Land plots for PSF can be of two types:
- Field plots — located outside of populated areas and not adjacent to them.
- Homestead plots — located within the boundaries of populated areas (urban or rural).
The main characteristic of field plots is that capital construction, such as building a residential house, is prohibited. According to Russian law, a residential house is a standalone building consisting of rooms and auxiliary spaces intended to meet the daily living needs of its occupants and cannot be divided into separate real estate units.
This means that the owner can only build small, non-foundational structures like sheds, greenhouses, and similar facilities. The primary purpose of these lands is for growing agricultural crops or raising animals.
Homestead plots, on the other hand, do not have such restrictions on construction. As a result, they are often used as an alternative to land designated for Individual Housing Construction (IHC).
Thus, you can build a house and register your residence on a PSF plot if it is located within the boundaries of a populated area.
It’s important to note that PSF is not considered commercial activity on land designated for “personal subsidiary farming.” A farmer who owns a PSF plot produces and processes products solely for personal needs, and may only sell the surplus.
PSF allows for the production and processing of agricultural products for personal use on one’s own land without registering as a sole proprietor or legal entity, with the intention of meeting the family’s needs. The owner may sell surplus products, such as eggs, meat, lard, or excess vegetables and fruits, at markets, but they are not allowed to sell these products systematically or on an industrial scale. Additionally, a residential house can be built on such a land plot.
to trade these products systematically or on an industrial scale. Additionally, it is possible to build a residential house on such a land plot.
Significant Difference Between PSF and IHC
One of the main differences between a PSF plot and an IHC plot is its cadastral value. The cadastral value of an IHC plot is generally significantly higher, so it can be sold for a higher price. However, keep in mind that as the cadastral value of the land increases, the land tax also increases.
Examples of cadastral values for personal subsidiary farming (PSF) and individual housing construction (IHC) plots in the Leningrad region:
PSF Plot
- Region: Leningrad Region
- Area: 10 ares (1,000 sq. m)
- Location: Rural area, outside a settlement
- Cadastral value: Around 150,000 – 300,000 rubles
IHC Plot
- Region: Leningrad Region
- Area: 10 ares (1,000 sq. m)
- Location: Within the city or near a settlement with developed infrastructure
- Cadastral value: Around 400,000 – 1,200,000 rubles
Conversion Of a PSF Plot To IHC
In Russia, it is possible to change a plot’s designated land use.
For example, if you find a plot located within a settlement that has PSF status, and you don’t plan on farming but want to build a house for permanent residence, it would make sense to go through the process and meet the requirements to convert the land’s designated use.
However, if you find a PSF plot outside the boundaries of a populated area, it cannot be converted to IHC, as being within a settlement is a key criterion for IHC.
The conversion of a PSF plot to IHC is done in 4 stages:
- Establish land use and territorial status.
- Gather documents for the plot.
- Submit a request to the local administration.
- Make amendments to the Unified State Register of Real Estate (USRN).
The documents and application are submitted to the local administration and USRN or a multifunctional center (MFC).
Gardening
Garden and vegetable plots can be used for:
- Recreation.
- Growing agricultural products for personal needs.
Garden Non-commercial Partnership (GNCP)
A GNCP is an association of plots and their owners for the purpose of cultivating land and gardening. An important difference from other forms of suburban associations is that GNCP lands are primarily intended for agricultural work for personal consumption. Agricultural work, in this case, is not mandatory.
Since 2019, according to Federal Law No. 217-FZ “On Gardening and Horticulture by Citizens for Personal Needs,” it is allowed to build residential homes on gardening land and register them as a place of residence.
The law distinguishes between a residential house and a garden house. You can live in either, but permanent registration and year-round living are only allowed in a residential house. A garden house is intended for seasonal use, and by law, it is suitable only for temporary stays. It is assumed that it lacks heating, sewage, and water supply — it’s essentially a summer cottage.
A garden house can only be built on a gardening plot. The same construction rules apply to garden houses as to residential homes: urban planning regulations and construction rules must be followed.
Essentially, the main difference between a garden house and a residential house is the ability to register a permanent residence in the latter. However, from a legal perspective, the difference is significant: a garden house is not counted when assessing family housing needs, and it cannot be built using maternity capital. In practice, you can live in such a house in both summer and winter, but officially it will be considered a non-residential space.
Advantages of a GNCP
- Lower plot cost compared to IHC.
- Lower tax liabilities.
- Property tax rate: For structures in GNCPs, the property tax rate is usually lower and may vary by region but does not exceed 0.3% of the inventory value.
If a residential house is recognized on a GNCP plot and there is the possibility of registration, the property tax will be calculated as for residential buildings based on the cadastral value.
Inventory value is the value of the property calculated based on data on construction costs, depreciation, and other factors related to the physical condition of the object.
- Fertile land, which is important for those planning to farm.
Gas Supply For a Land Plot
In 2021, Russia launched a gasification program. In settlements where gas lines are already available, gas is provided for free to the borders of the plot. The program is implemented by a single operator, LLC “Gazprom Gasification.”
IHC lands located in larger settlements are often equipped with all utilities, including gas.
However, GNCPs are not yet fully included in the program. The gas line can only be extended to the boundaries of the GNCP for free, and within the partnership, each owner must connect utilities to their own plot independently. It seems that a new initiative from the President will grant the right to free gas pipeline connection directly to garden plots. (From April 16, 2024, the Russian Government adopted Resolution No. 484: GNCPs located within gasified settlements are included in the Social Gasification program.)
However, it is still unclear how the broader problem will be solved. GNCPs can apply for free gas connections if they are located within the boundaries of a gasified settlement. Otherwise, the pipeline will be extended only for a fee.
The gas supply procedure involves submitting an application for gas provision. Usually, this is done online through the Unified Gasification portal. Neighbors often submit a joint application, increasing the chances of faster connection.
If you are the only one interested in bringing gas to your plot, the process might take longer.
The gas supply procedure includes laying pipes to your plot, which is part of the social program and is free. However, everything related to your plot, such as pipe extensions, boiler installation, etc., is the financial responsibility of the plot owner.
The main need for gas in a GNCP plot is heating the house, and using gas would be cheaper. If gas is not available on your plot, you will have to choose alternative heating methods: wood (stove), electric floor heating, etc.
Conclusion
Van Rhijn & Partners can advise you on land categories and land use designations, and, if necessary, assist in converting land from one category to another. We also offer expert assistance in selecting and purchasing a suitable plot of land or an already built home that meets your needs. Additionally, we can help prepare the necessary documents to begin construction.
Get in touch with Van Rhijn & Partners today to take the next step toward finding your ideal property or starting your construction project.
