In 2021, the real estate market of Ukraine became noticeably more active. Developers launched many new facilities, and apartment prices and demand increased significantly in all segments.
Some experts are already comparing the current situation with the situation in 2008, when the real estate market collapsed, not only in Ukraine, but also in the whole world. We will not guess on the coffee grounds what awaits us. Banker.ua spoke with Kostyantyn Pisarenko, the founder of one of the capital's real estate agencies, THE CAPITAL, who not only created an efficient team that provides expert services in the premium segment real estate market, but also tries to form a new philosophy of perception of agency services, moving away from the outdated cliché "realtors ” to the broad concept of “real estate experts”. By the way, if you are thinking about buying real estate, we recommend that you contact us professional luxury real estate agency THE Capital.
On May 21, 2020, Kostyantyn Pisarenko launched the YouTube channel "Real Estate Without Censorship", which became one of the most famous in the Ukrainian YouTube segment. On the eve of the New Year's holidays, together with Konstantin, we sum up the results of the busy 2021 for the real estate market and forecast trends for the coming year.
ON THE POSSIBLE COLLAPSE OF THE REAL ESTATE MARKET
We have not had such growth in the real estate market since 2014. However, I think that Ukraine is in for a market collapse. This "bubble" is deflating, and the main question is not the months when the recession will begin (I think the recession will begin within two to four months), but how much it will deflate.
See also: Renting an apartment: how to write an ad correctly?
Why would this happen? There are many objective factors, but the main thing is that the investors themselves do not have enough money to buy new apartments. Even now, sales departments of developers are not executing sales plans. I believe that subsidence is possible up to 15-20%. Of course, no one knows exactly how this domino will start to fall. The reason is that those who wanted to "park" the money did so, and Law No. 5600 has not even entered into force yet!
ON THE COST OF BUSINESS CLASS REAL ESTATE
I will not talk about all of Ukraine, but specifically about Kyiv. Everything that developers are trying to build at least in the Comfort class will now increase in price very well. In the next 2-3 years, such real estate may grow even more, because the average price of "Comfort" will exceed $1500/m², and "Comfort+" will already reach $2000. I will give an example. The price of an apartment in the "French Quarter 2" residential complex is $2500/m². This is a lot for "Comfort+", and when this segment begins to "creep up" to the business, premium class segment, as, for example, in "Bulvar Fontaniv" residential complex and compete with it directly, people often choose a promoted object. That is, they choose "French Quarter 2" at an identical price (a difference of 5-10% is already the same price), when there is poor noise insulation, a courtyard area, there is practically no possibility to park, unlike "Fontaniv Boulevard", which has such issues none at all.
ABOUT COUNTRY REAL ESTATE
If we talk about our average customer who buys the premium segment, then this is a 40-year-old family man with children. And when you have children, you, unfortunately, cannot afford to live outside the city in the full sense of the word. Children have to go to school, attend classes, clubs, and birthday parties of their friends. So it turns out that if you live outside the city, you live in a car, or you have to have an unrealistic number of staff, assistants, a personal driver. Therefore, a country house as an addition to your main residence or as a country residence is, of course, great. Otherwise, it is inconvenient for an average family with children.
See also: How to rent a non-residential premises?
ABOUT THE CLASSIFICATION OF THE BUSINESS SEGMENT
I cannot consider a house with ceilings of 2.7 or 2.8 m as a business-class object: it is oppressive, you do not feel premiumness in this house. I recently filmed a video for my channel in a wonderful house, which I really enjoyed. And I would really like to call this real estate object "Business" or "Premium", but the ceiling is 2.8 m. We are talking about Obolon Residences. This is a really cool house, but I don't understand why they saved on the height of the ceilings. Was it difficult to lose one floor? Business class is underground parking, three-meter ceilings, when you have a concierge or a decent house guard, it's a big, beautiful front (in business class there can be no such thing as an "entrance").
It should be a good yard area, even if it is a single house, with a playground, a place to walk, infrastructure inside the house, for example, a gym, a shop, a beauty salon, etc. Currently, there are such objects in Kyiv. For example, several interesting buildings are being built in the Pecherskyi district of Kyiv - Nordica Residence and FJORD, as well as the most interesting building with three-meter ceilings Creator City and UNIT.Home with interesting features, located in the historical center of the Shevchenkivskyi district of the city in the immediate vicinity of the Pushkinsky, KPI and Kyivskyi parks zoo. Several buildings are currently being built in Podil, which will be part of the business class segment, the same as La Manche, Spas Sky and many others in different areas of the capital.
ABOUT CORPORATE SOCIAL RESPONSIBILITY OF BUSINESS
Above all, we take care of our employees so that they take care of their customers. Because care is what is missing in society. Secondly, we consider it important to take care of a person so that he wants to pay you. Because in our country, the image of a realtor who "extorts" money from his clients, manipulates them, has firmly established itself near the headboard. We want to position ourselves in a completely different way: a realtor is a person who helps. There are people who help buy a car, inspect it, make a technical conclusion. Without some knowledge, you won't do it. The same is true in our business sphere. As a real estate agency, we do not care which developer's property to sell. For us, it is more important than the client's need — to hear and find exactly what he needs. If, for example, the client is single, he can be sold an apartment in TARYAN TOWERS. Because how can we sell such an apartment to a family in a building where there is no normal yard? We understand that "Bulvar Fontaniv" or "Novopecherski Lypky" are great places for families. I believe that we should be paid precisely for expertise. And a big plus is when we work with developers who understand that agencies are their assistants.
PREMIUM SEGMENT INVESTMENT QUALITY
You won't earn much in the premium segment. There are, of course, exceptions, but we had only two such objects: Tetris Hall and TARYAN TOWERS. There are many more such objects in the "Comfort" segment. The premium segment means saving money, good liquidity, and if necessary, it is easier to sell. It is impossible to say that it is possible to pluck some kush there.
CONSTRUCTION BOOM-2021
Now there is really a lot of construction, about five times more than at any time before the crisis of 2008. Both Kyiv and the suburbs are being actively developed. Some new residential complexes can accommodate 10, 15 and even 20 thousand people. That is, these are already kind of satellite cities, and not residential complexes. And people who come to the metropolis can start in these complexes.
THE MAIN TRENDS OF 2022
- Country real estate. Country real estate developers are ready to listen and hear, they are not spoiled, you can have a dialogue with him, ask for additional options, for example, lakes and fountains on the territory, plant more trees, a kindergarten, a swimming pool.
- Large housing complexes. People do not want to live in single houses. They want to live in big, beautiful RCs with good infrastructure. They are willing to overpay to live with their peers in their class/environment. A good example of this is the Great residential complex on the banks of the Dnieper.
- Blurring of the concept of "city center". The concept of "center" is already blurred, and not everyone needs the city center anymore. Because getting there means wasting a lot of time if you don't work there. Everyone wants to live where he grew up, to spend more time, so there are centers in every district of the city. A good example of this is Fine Town. For some, it is the edge of the world, but now people are ready to pay $2200 for a "square" and wait a year and a half for a comfort-class apartment right there. And so in each district of Kyiv, their own centers and conglomerates are formed, for which people are ready to pay a lot of money.
- Coastal area. The trend of the next decade is that the coastal area will finally begin to be developed. I believe that the entire industrial zone should be thrown out of the city, and the coastal area, as in all European countries, should be given over to residential development. People should live in houses with a great view from the window.
Was the publication interesting and useful? Subscribe to our real estate blog updates and receive new posts from THE Capital real estate agency.
