Ukraine Real Estate Market.

How to buy property in Ukraine.

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Until recently, Ukraine real estate attracted second-largest volume of foreign and domestic investments following the financial sector. At the time main materials of this article written (May, 2009), the once-booming Ukrainian real estate market is going through its bad period. Due to the world financial crisis developers and investors into Ukraine real estate were faced with big economic troubles. As a result, many construction projects were frozen and number of them are "for sale" now.

Have you ever noticed, when you turn on the news they usually have to tell you the bad news first. Then, if they have time, they might will tell a "feel good" story at the end. The same can be said about the way the media is portraying conditions on the Ukraine real estate market. Everywhere you can hear how terrible the Ukraine investment market is. Bad news SELLS.

In no way I am a real estate specialist. But let's just try to invite our common sense and ask a real estate professional's opinion. Our common sense tells us that sooner or later economy will get better. Everything goes in circles. -:) What about professionals? Here is opinion of one of the brightest among them - Donald Trump.

"If you're one of the fortunate few who is looking to buy, you could hardly be in a better position. I think the housing market is going to get better and it's going to get better fairly quickly. The market is depressed and that's when you want to go in. So if you have the money, now's when you want to go out and buy. But that's just my opinion. After all, what does Donald Trump know about real estate!

Smart people are always caution when it comes to spending their hard earned money. Thinking about buying Ukraine real estate either for investment purposes or just as a place to live, you shouldn't make your decision following some one's opinion or your own emotions only. Study up the market to get a general idea first. Let's look at the big picture.

Why People Invest into Ukraine Real Estate.

The two major rules of real estate are:

• To make money, buy it right.
• Buy low-sell high.

Can you really "buy low" in Ukraine? As an example, let's consider Prices for residential real estate presented (January, 2007) by the independent Ukraine real estate specialist Sergey Kalinin.

Rank	City	Price/sq.m, USD	Population, thousands
1	Kiev	2 600	2 108
2	Odessa	1 820	1 020
3	Dnepropetrovsk	1 340	1 043
4	Sevastopol	1 275	379
5	Kharkov	1 170	1 463
6	Simferopol	1 120	371
7-10	Lvov	1 100	735
7-10	Nikolaev	1 100	508
7-10	Uzhgorod	1 100	117
7-10	Chernovtsy	1 100	243
11	Khmelnitsky	1 050	257
12	Vinnitsa	1 000	382
13	Ternopol	995	220
14	Rovno	925	248
15	Zhitomir	910	276
16	Zaporizhye	900	795
17-18	Ivano-Frankovsk	870	221
17-18	Lutsk	870	205
19	Donetsk	865	994
20	Chernigov	840	300
21	Poltava	820	309
22	Cherkassy	820	292
23	Lugansk	800	450
24	Sumy	760	280
25	Kherson	750	316
26	Kirovograd	645	246

Relatively low to compare to West-European countries prices per Square Meter of residential property looked very attractive for investors. But at the same time highly dynamic rise of Ukraine real estate prices during the last few years made Ukrainian market one of the most lucrative and desirable places in Europe for investors.

According to Kiev real estate company Blagovest , an average rise in price of Kiev flats, amounted to 51 % in 2006, 44 % in 2007, and 17.6 % in 2006. What are the causes of Ukraine real estate boom and such high yearly rise real estate prices?

Independent Ukraine is a young country. As any new born and growing system it has powerful "natural engines" to make it grow. In Soviet times all people were artificially kept "equal" to each other. Not much could be done legally to increase your income level. Nowadays most of those restrictions have gone and people have possibility to earn money. Ukraine real estate is one of the best ways for doing this.

Here are the major reasons of the rapid rise in price of real-estate in Ukraine:

• Due to the rising income level people look for investing opportunities and improving their living conditions .
• Real estate is traditionally one of the safest kinds of investment since after banking crisis of the early 1990s when people lost their savings they don't trust banks.
• Ukraine's economics doesn't still have too much investment alternatives to offer.
• Since Ukraine became independent people tend to move to the big cities where more capital and opportunities are concentrated. They were not allowed to move freely before.
• There was no system of widely accessible bank loans and mortgages in the Soviet Union. They are available now and in spite of very high interest rates people actively borrow bank money.

Ukraine real estate is going through many challenges (May, 2009). According to Colliers International "Real Estate Review" (2009, Ukraine) one shouldn't expect full recovery of investing transactions until Ukraine's economy demonstrates clear signs of recovery. Nevertheless, foreign investor's interest to Ukrainian market will remain strong.

This year (2009) may be a good time to reconsider an existing real estate strategy and look for a good opportunity to find reasonable priced properties that will become valuable income generators over the coming years.

What you need to buy property in Ukraine.

To buy property in Ukraine is more difficult than in the US, for example. It is not that simple even for the Ukrainian/Russian native speakers. The main reasons are a lack of legal infrastructure, pointless regulations and far not perfect way of paperwork execution. However, it is manageable. To buy property in Ukraine you will need:

• Study up and know the market if you're going to dive in. Overview of Ukraine real estate market can found at the Global Property Guide.
• It is essential to have a well-established real-estate agency or a well-informed independent adviser to guide your through the process. It is impossible to check the legal status of a property without an agency.
• It is easier to transfer money to the seller's bank account or to pay him in cash if you have your bank account in Ukraine. You don't need any special documents to bring up to $15,000 USD into Ukraine.
• Be patient and have a decent local lawyer. It will cost you less time and money than your own attempts to figure out how to avoid numerous legal "pitfalls" on the way.
• Be careful and know your limits.

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