Many, if not all people who visit Ukraine for the first time arrive in Kyiv. One of the big surprises for them is when they discover the high prices on the Ukraine residential property market. The overall market has not picked up since the crisis of 2009 but prices are still in what I call the ‘crazy category’
Why should property in Ukraine be more expensive than the following countries in the EU? :
Malta, Slovenia, Romania, Cyprus, Latvia, Estonia, Croatia, Lithuania, Hungary, Portugal and Bulgaria
So we can say that Ukraine is more expensive than 12 EU countries.
What is so special about Ukraine? Some locals will claim that it is due to the demand of not enough housing stock in the first place and people just want to have their own place to live and are prepared to do anything to have their own place of residence. Some property developers would claim it is just a simple of case of supply and demand.
Since the financial crisis and the on-going problems with the economy and political unrest in the country, prices have still not reduced.
Moreover, there is a major difference in how new properties are sold in Ukraine. They are not really finished when they are sold although the developer will be doing no further work after you have paid. Why? – Well in Ukraine the normal practice is to sell property in the ‘core and shell’ state. Which means the property is a bare shell, no windows, (but maybe sometimes), no doors, no plaster on the walls, no floors, no ceilings just a brick shell with water and electricity and sometimes gas supplied. The rest is up to you. The ‘rest’ will probably cost the same if not more than the sales prices to fully complete the property ready for living.
Can you imagine an EU citizen buying a property in Malta or Cyprus or Portugal which had been completed to a state where it cannot be used for living?
The secondary market (used market) is a little easier as the buyer would be able to move in without too much extra expense? But, most of the property stock in Ukraine is still made up of apartment buildings constructed during Soviet Union times. Buy WHY should an old place be so expensive? Here is one example chosen at random. A 2 bedroom apartment in Kyiv, 75 SQM in an old building. The asking price is a crazy $210,000 - http://www.apartments.kiev.ua/sale/kh3v37s.htm
It is any wonder that so many Ukrainian people get the surprise of their lives when they visit EU countries for the first time and see things are much better and lower priced that back home.
Is it any wonder they want to leave Ukraine?
Ukraine is a poor country yet it continues to act like it is for rich people only. Things need to change.