Ukraine’s chaotic real estate market
It’s the Wild West in Kyiv’s real estate market – big gains or painful losses.
While the government fails to provide strict construction rules and protect its historic architecture, many real estate firms are taking advantage of the situation.
Some are building multi-story “monsters” in the heart of Ukraine’s cultural heritage, some are trying to quickly cash in on poor quality constructions, some falsely promise to include social infrastructure in their development plans to lure in buyers, while others plan to stay closely connected to the government and gain preferences from the state.
Despite the lawlessness, the real estate sector is showing stronger signs of recovery and stability: Kyiv’s office market has been showing the lowest levels of vacancy since 2008 and, with a hike in prices, retail vacancy rates are at an all-time low since 2013. Investors are showing a growing appetite for commercial buildings – most notably the IT sector.
But the problem in Kyiv’s real estate market is as it is with every market in the city – without strong rule of law and the punishment of wrongdoers, the market will continue to be a high-risk business.