April 17, 2023

The rocket attacks turned the market upside down. How real estate prices in Ukraine have changed during the year of the war

The year of the war did not prevent the development of the real estate market in large cities. Work continues on more than 70% of construction sites in Kyiv, Lviv and Odessa. Price trends changed in October – after the start of massive rocket attacks.

The cost per square meter grew in line with the growth in construction costs, the devaluation of the hryvnia and the distance from the front line. Since October 2022, prices in Lviv have continued to grow rapidly, while in Kyiv and Odessa they have remained relatively stable. This is evidenced by data from M4U, a company specializing in intelligent real estate solutions.

Real Estate in Kyiv

According to M4U, at the beginning of February 2023, the average cost per square meter in new buildings in Kyiv was UAH 61,234. This is 36.1% more than it was before the Russian invasion of Ukraine. The indicator of price growth is fully correlated with the growth of construction costs and the devaluation of the hryvnia.

The most active prices grew in summer: from June to September, the average cost per square meter increased by 26.7%.

“The explanation for this is the resumption of work of a significant part of the sales departments and, as a result, the updating of prices and the official exchange rate from 29 to 36 UAH/$,” explained Volodymyr Danilenko, founder of M4U. In February 2023, the price decreased by 1.2% compared to January.

“Today, the pace of construction work is significantly lower than before the war, so it makes no sense and possibility for developers to recalculate the cost of construction,” Danilenko said. — Market factors of price growth are also absent. So we are seeing a very weak trend.”

The number of active constructions today is 83.7% of the figure for the beginning of February 2022 – 185 out of 221 residential complexes. This figure has remained more or less stable over the past months.

The greatest rise in price per square meter is observed in the elite (+46.1%) and economy (+44.3%) segments. Price growth in comfort and business classes popular among buyers amounted to 35.5% and 34.4%, respectively. At the beginning of February 2023, most real estate offers are concentrated in the price range of UAH 34,000 – 54,000, comfort class properties prevail among them.

Traditionally, the largest number of new buildings, as well as offers of apartments, is in the Goloseevsky district of Kyiv. More than half of them (16 out of 29 LCDs) are comfort-class facilities. The second in terms of construction volume is the Pechersky district, where 15 out of 26 residential complexes are positioned in the business class, the rest are in the elite. In the Shevchenkovsky district of Kyiv, 24 LCDs are being built, most of which are business class. Fewer new houses are being built in Obolonsky (11 LCD) and Desnyansky (10 LCD) districts. At the same time, the supply of new apartments in the Desnyansky district is twice as high as the supply in Obolonsky, housing in the economy class residential complex prevails.

Properties in Kyiv region

In the Kyiv region, at the beginning of February 2023, 204 construction sites out of 263 that worked a year ago (77.5%) resumed work. A square meter in the vicinity of the capital rose by an average of 34.1% to UAH 31,844. The most active rise in prices in the suburbs, as well as in the capital, was observed in the summer, while from October to February the price practically did not change.

The cost per square meter increased more in comfort class new buildings – by 33%, to UAH 29,992. Apartments in new buildings of economy and business classes rose in price by 30% and 30.1%, respectively. The increase in prices in the objects positioned in the elite class amounted to 28%. Most of the offers of the capital region belong to the comfort and business class and the price range is 26,000 – 32,000 UAH.

Most of the objects that are actively being built and sold are in Irpen (41 residential complexes), Sofiyivska Borshchagovka (17 residential complexes), Brovary, Gostomel (13 residential complexes each) and Bucha (12 residential complexes). In terms of the volume of apartments for sale, the leaders are Sofievskaya Borshchagovka and Brovary, there are somewhat fewer offers in Kryukovshchina, Irpin, Bucha.

Real Estate in Lviv

The number of new buildings in the active stage of construction and sales in Lviv and the Lviv region today is the same as it was before the Russian invasion – 218, during the year this figure changed insignificantly. The average cost per square meter increased by 82.7% over the year, to UAH 45,706. As in Kyiv, the most active rise in prices fell on the period of June-September.

Most Lviv objects are presented in the price range from UAH 24,000 to UAH 34,000; comfort class dominates in the supply structure. We see the greatest dynamics of price growth in business class properties, where the cost per square meter more than doubled over the year – by 109%. In the economy segment, growth for the year amounted to 66.7%, comfort – 60.3%, elite – 58.7%.

The largest volume of supply of apartments in new buildings in Lviv is concentrated in Shevchenkovsky (35 residential complex) and Sykhivsky (32 residential complex) districts. Both areas are dominated by comfort and business class facilities.

Real Estate in Odessa

In Odessa and the region, a square meter in new buildings rose in price by an average of 48.4% during the year of the war. At the same time, if before the war there were 180 active construction sites in the city, now there are only 131 (72.8%), but since November their number has been gradually growing.

As in other regions, the most active price for real estate in new buildings in Odessa grew during the summer of 2022, in October the growth stopped, and since December there has even been a decrease in prices, on average by 2.3% over 2 months.

Over the year, a square meter has risen in price more in the economy and elite segments – by 59% and 57%, respectively. The growth of the average price in comfort class new buildings amounted to 46.1%. And the most interesting dynamics is in the business class: over the year, the cost per square meter there increased by an average of 39.5%, however, it is in this class that the largest price reduction is observed during September 2022 – February 2023, which amounted to 5.1%.

Most of the offers in Odessa new buildings are presented in the comfort and business segments, in the price range from 24,000 to 38,000 UAH. Geographically, in terms of the number of new buildings, the leader is the Primorsky district of the city, where apartments are now being sold in 30 LCDs, of which 16 are positioned in the elite class. In the Kievsky district, 25 residential complexes are being actively built, 12 of them belong to the comfort class.