Should You Invest?
Despite flaws in the Ukrainian economy the country has shown
that it is strong enough to overcome its troubled past and rebuild
itself. Strong economic growth is continuing particularly in real
estate where in recent years there have been 50% price increases on
property and 100% increases on land investment.
- Ukraine is currently experiencing high rental yields especially
in built up cities such as Kiev.
- The rental market is pro-landlord making it easier on
investors.
- There are low transaction costs between the buyer and seller
when purchasing a property.
- The moderate rental income tax encourages potential investors
to buy.
- The country has shown good economic growth in recent
years.
- Nationals of Ukraine are showing eagerness and willingness to
learn new skills, take on employment and take full advantage of the
education provided, which in time will improve the country's work
force.
- Many cities in Ukraine are being developed with more buildings
being built, improved public services and incentives to attract
more tourism.
Rental Yields
The majority of investors are buying into apartments on a
buy-to-let basis to cater for the growing number of tourists
visiting the country. Ukraine is currently experiencing high rental
yields in major cities such as Kiev where the average rental yield
is currently 8.8% and it is estimated that yields range between
6.9% - 10.2%. The bigger the property is, the lower the rental
yield; for example a 180 square metre property has an average yield
of around 7.5% whereas a 50 square metre property has an average
yield of 10.2%.
location
type of
property |
size
m2 |
average
price
to buy
(€) |
cost per
m2 to buy
(€) |
average
price
to rent
(€) |
costr per
m2 to rent
(€) |
yield
(%) |
Kiev-
Apartments |
|
|
|
|
|
|
| |
50 |
129,400 |
2,588 |
1,100 |
22 |
10.20% |
| |
80 |
220,500 |
2,756 |
1,880 |
23.5 |
10.23% |
| |
120 |
336,805 |
2,807 |
2,550 |
21.3 |
9.09% |
| |
150 |
495,600 |
3,304 |
2,870 |
19.1 |
6.95% |
| |
180 |
575,800 |
3,199 |
3,600 |
20 |
7.50% |
Source:
Global Property Guide
Price History
In recent years Ukraine has experienced considerable property
price rises in the real estate market. Kiev saw a rise of 70% in
property prices since 2003 and the average property prices range
from €2,588 to €3,304 per sq m. Between January and March the
rental sector blossomed and was the fastest growing sector enjoying
a rise of 17.6%. The property boom has recently slowed
though and prices are starting to fall - a drop of 5.8% was
experienced in the second quarter of 2007.
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