It would seem that residential complexes located in the same area, and especially on the same street, should not differ in cost per square meter. No matter how it is! Prices for apartments in neighboring buildings can be like heaven and earth. And the most amazing thing is that both exorbitant amounts and quite reasonable price tags will be equally fair. Don't see the logic? Great, otherwise you wouldn't have anything to do on this page. We invite you to understand the stable and situational factors that cause prices for properties in new buildings to so often shock uninitiated investors.
4 letters "O": features of the object - the basis of the basics
It’s worth starting with those factors that are basic. Banal object characteristics will already tell you how much you can expect. It is worth taking into account:
- location. What area is this? How prestigious is it? Are transport connections with other parts of the city well developed? What about social infrastructure - is there somewhere to walk, where to go, what to see? Will it be comfortable for children to get to school? And is this area suitable enough for them - how safe and environmentally friendly is it?;
- construction technology. You can always save money and buy a “socket”, but all theoretical and practical problems with operation fall entirely on your shoulders. If your budget allows, you can splurge on good-quality red brick, which is not afraid of either frost or summer heat. Monolithic frame technology is now at the peak of popularity for a reason, so it’s also worth taking a closer look at - quality and price combine quite well;
- layout. The tight confines of small rooms are not always convenient. Spacious multifunctional spaces are now in demand and are therefore often found in upscale residential complexes;
- number of floors It's not just the beautiful panorama of the city (although that's part of it too). The first and last floors are associated with some inconveniences in terms of your privacy and possible problems with floors;
- degree of readiness of the object. The lower it is, the lower the price. Nobody wants to pay for a long wait, so buying an apartment at the foundation pit stage can cost 30-40% less than purchasing it after the complex is put into operation - sounds like great way to earn on your ingenuity and endurance;
- class of residential complex. The words “business”, “economy”, “comfort” and “elite” are a big clue to what the price per square meter will be.
It’s worth dwelling on the last point in more detail, which we will do at the beginning of next month, but for now we’ll just briefly glance at the nuances. The definition of the class of a complex includes a number of services and amenities available on its territory. The more additional benefits, the higher the cost of the object:
- closed territory, the presence of a 24-hour video surveillance system, concierge service and security system - you have to pay a little more for security and privacy;
- take care of yourself, think about your car - spontaneous open-air parking is much inferior in comparison with underground parking;
- beautiful city views are valued much higher than the nondescript residential areas outside the window;
- the presence of its own infrastructure is the most pleasant bonus, allowing residents of the complex to save time, because everything they need is at hand;
- The arrangement of the local area affects not only its appearance, but also the leisure time of residents. Having walking paths and beautiful park areas in the yard, you can end your evenings with family promenades near the house, which is especially important for young parents;
- Residents of apartment buildings often encounter traffic jams even before going outside, so even such a small thing as the number of elevators also affects the price.
The above criteria influence apartment cost under absolutely any circumstances. But even they won't be able to keep its price in place if more capricious factors come into play.
Statistics, analytics, forecasting, etc. – real estate valuation at a new level
The greatest, although not direct, blow to new buildings was dealt by military actions. Because of them, difficulties arose with supplies, so the extraction of materials turned into a real quest. This problem has led to another one – an increase in the price of raw materials. No one would dare call these problems far-fetched and artificial because each of us has encountered them in one way or another, even in everyday things. This factor alone led to an increase in construction costs by 40%. All because of the same military actions, a shortage of qualified personnel began to be felt sharply. Many builders have temporarily retrained as defenders of their country, for which we can only thank them.
To summarize, we can say that since the beginning of 2022, the cost of housing in new buildings has been most affected by:
- socio-economic factors;
- currency fluctuations;
- logistics problems;
- construction cost;
- shortage of qualified labor.
At the same time, factors familiar to us from pre-war times remain. Thus, a decrease in temperature outside the window also pulls down the arrow of the price curve, which reflects influence of seasonality on supply and demand. Trends in environmental friendliness and adherence to concepts aimed at the comfort of residents (“yard without cars”, “city within a city”) allow developers to raise prices regardless of the time of year.
Thanks to the evaluation all factors and analysis last year's trends, our experts look into the future and foresee further price increases. This trend is already observed in many cities. Since the beginning of the year, the cost per square meter has changed significantly. There were even sharp jumps:
- in Ivano-Frankivsk – from 23 to 400 hryvnia;
- in Lviv – from 44 to 200 hryvnia;
- in Khmelnitsky - from 20 to 700 hryvnia.
Our colleague notes that Kyiv has not yet been hit by a wave of price increases. So far, the usual 48 has increased by only 300 hryvnia. Investors should arm themselves with cash reserves and grab their tasty morsel at an affordable price.
