Is it worth investing in real estate in Ukraine during the war: prices are falling
Date: 2024-08-30 Author: Nazar Litvin Categories: ECONOMY
Buying an apartment in 2024 is a good option for investment or capital savings. Thus, according to Factum Group, the desire to make money on real estate is one of the three main drivers for buying a home.
"Real estate tends to increase in value over time, which opens up the opportunity to make a profit when reselling it. Although the situation with housing prices varies depending on the region, in general, the cost of real estate tends to increase," says Oksana Ostapchuk, Head of Sales Development at OLX Real Estate.
Real estate remains a relatively stable asset that can serve as a hedge against inflation. Owning real estate also allows you to receive passive income through rent. However, it should be remembered that it is not always possible to make a profit from real estate right away. First, you need to decide on the purpose of buying a home.
Renting out an apartment can bring in a stable passive income every month, but it comes with maintenance costs, and the payback period can take several years.
Investing at the construction stage for the purpose of subsequent resale can be profitable, but now it is relatively risky, so it is necessary to carefully check the developer and documentation.
Buying a finished home for renovation and resale can bring up to 40% profit, but requires additional investment in renovation.
Buying a finished home to preserve capital or subsequent sale is a less risky option, but requires significant investment.
What is happening in the residential real estate market
Real estate prices fell in the summer, and this trend will probably last until the beginning of September, says Oksana Ostapchuk.
"The summer period is usually characterized by a certain drop in prices, but this year we are seeing a fairly noticeable decrease in real estate prices in the northern, central, eastern and southern regions of the country. The western regions are showing a tendency towards price growth," the expert says.
Trends in different regions:
Lviv – apartment prices remain stable, although demand has decreased slightly. There are more offers on the market than before the start of the full-scale war.
Kyiv and the region – apartment prices have decreased by 10-15%. The market is expected to become more active in the fall.
Ivano-Frankivsk – the new-build market is actively developing, the number of offers is increasing and demand is growing, which is not typical for the summer season.
Odesa – there is a decrease in both offers and demand for the sale of apartments. The summer season is characterized by high demand for daily rent.
Dnepr – the situation is similar to Odessa, with a drop in prices in the apartment sales segment.
"Real estate tends to increase in value over time, which opens up the opportunity to make a profit when reselling it. Although the situation with housing prices varies depending on the region, in general, the cost of real estate tends to increase," says Oksana Ostapchuk, Head of Sales Development at OLX Real Estate.
Real estate remains a relatively stable asset that can serve as a hedge against inflation. Owning real estate also allows you to receive passive income through rent. However, it should be remembered that it is not always possible to make a profit from real estate right away. First, you need to decide on the purpose of buying a home.
Renting out an apartment can bring in a stable passive income every month, but it comes with maintenance costs, and the payback period can take several years.
Investing at the construction stage for the purpose of subsequent resale can be profitable, but now it is relatively risky, so it is necessary to carefully check the developer and documentation.
Buying a finished home for renovation and resale can bring up to 40% profit, but requires additional investment in renovation.
Buying a finished home to preserve capital or subsequent sale is a less risky option, but requires significant investment.
What is happening in the residential real estate market
Real estate prices fell in the summer, and this trend will probably last until the beginning of September, says Oksana Ostapchuk.
"The summer period is usually characterized by a certain drop in prices, but this year we are seeing a fairly noticeable decrease in real estate prices in the northern, central, eastern and southern regions of the country. The western regions are showing a tendency towards price growth," the expert says.
Trends in different regions:
Lviv – apartment prices remain stable, although demand has decreased slightly. There are more offers on the market than before the start of the full-scale war.
Kyiv and the region – apartment prices have decreased by 10-15%. The market is expected to become more active in the fall.
Ivano-Frankivsk – the new-build market is actively developing, the number of offers is increasing and demand is growing, which is not typical for the summer season.
Odesa – there is a decrease in both offers and demand for the sale of apartments. The summer season is characterized by high demand for daily rent.
Dnepr – the situation is similar to Odessa, with a drop in prices in the apartment sales segment.
