The war in Ukraine collapsed the real estate market – both primary and secondary. Ukrainians have lost their livelihood, so they are in no hurry to invest their last money in new housing.
5 months of fall
Housing losses in Ukraine during the four months of a full-scale Russian invasion exceeded the number of housing commissioned in the past five years. At the same time, starting from February 24, only 39 new buildings in Ukraine received certificates of commissioning. In total, during the war, 385 thousand square meters were commissioned. m of housing.
According to the LUN, the record holder was the Kyiv region, the second – Lviv, the third – Odessa. By the way, in the last pre-war years, Ukrainian developers annually put into operation 9-10 million square meters. m of housing.
In addition, real estate sales registers were closed from February 24 to May. This, in fact, paralyzed the sale and purchase transactions. Registers were officially opened in May, but not in all regions. The proximity of the front and active hostilities played an important role here. But even after the opening of registers in the rear cities, sales did not intensify. So far, developers can not boast of high performance.
The first day after the resumption of work, Igor Kushnir, the president of the holding company Kievgorstroy, described in the media this way: “It’s about nothing.” If until February the largest developer in the capital was selling an average of 20 apartments a day, then at that time – three.
As for prices, so far they have even grown over the past six months. The average cost per square meter of housing in Ukraine increased by 8% in the secondary market, and by 11% in the primary market.
By regions, the most favorable average price per square meter for July in new buildings in the Ivano-Frankivsk region is 17,834 hryvnias.
However, in the future, real estate prices in the capital of Ukraine may fall, said Ivan Kudoyar, head of the Union of Real Estate Consultants, in the media. According to him, in 3-6 months we should expect a sharp drop in the cost of housing, by 20-30% of the pre-war price.
According to the managing partner of the consulting company SV Development Sergey Kostetsky, property owners are already selling it much cheaper.
“The offer price is one thing. No one buys at this price anyway. We can state that the transaction price has decreased by at least 30 percent, or even more. Roughly speaking, 10 apartments in the house can be put up for 100 thousand dollars, but in the same house they will buy an apartment for 70 thousand. Agencies place the apartments of the owners, in case they buy something. But no one buys for such prices. If you really want to sell and set the price like everyone else, then no one will buy it But if you reduce the price by 30-40%, then you will sell this apartment,” the expert believes.
A similar opinion was expressed in the media and Maxim Orishchak, an analyst at the Center for Exchange Technologies. In his opinion, a “buyer’s market” has begun in Ukraine in terms of real estate, so you can bargain like never before. Also, according to him, requests have changed a lot. Selling an apartment in installments will most likely not be considered. Just buying apartments in connection with the expansion of the family or offices for the future in connection with the opening of a new business – this should not be expected in the next 5-8 years, the expert believes.
Problems in the markets do not subside
Trends in the markets of primary and secondary housing paint a disappointing picture. These markets are more dead than alive, says Sergei Kostecki.
“The primary market, of course, is in a catastrophic situation. Now not a single sane person will buy an apartment at the initial stage of construction. Developers basically have no money. “, fuel, the dollar has risen. The situation for developers is catastrophic. If someone completes the construction of objects, then only those that are almost ready. The rest – I don’t even know how it will be. There will be many frozen objects, many problems, “says expert.
In addition, according to expert opinion, in the near future there will be problems with apartments bought with a mortgage. It is quite possible that the increased interest and the loss of a source of income will force Ukrainians to massively get rid of such housing.
“Ukrainians will not be able to pay new interest on loans, so there will be a lot of cars and apartments for sale. These will be ready-made apartments in new buildings or with assignment of contracts. But it will be a very large mass of apartments, because people will not be able to draw interest,” – Real estate expert Yaroslav Tsukanov expressed his opinion in the media.
As for the secondary market, according to Sergey Kostetsky, it is also more dead than alive. Rarely do they buy housing for themselves, mostly – donation, exchange.
“Well, if you want to buy an apartment on the secondary market, then it will be cheaper than an apartment in a neighboring house on the” primary “. Basically, the offer has left the secondary market, there are 20 percent of the offer that was left. There are other offers, but there are prices inadequate and no one buys such apartments,” the expert says.
As the NV Business study showed, in the secondary market, sellers are already ready to give in, but buyers are in no hurry to take real estate even at such prices. It is noted that, depending on the region, sellers are already ready to reduce prices from 5 to 30% throughout the country. The cost of housing depends on the proximity of hostilities – the closer, the greater the discount.
So, in Uzhgorod, potential buyers can count on a 5% reduction from the pre-war cost, in the Dnieper – by 20%, in Kyiv – by 10-15%. However, buyers are in no hurry. Especially now, when priorities have changed: the best housing today is the lower floors, next to a basement or a full-fledged bomb shelter.