Baltic Journal of Economic Studies (Dec 2022)
ANALYSIS OF THE CURRENT STATE AND MAIN TRENDS IN THE REAL ESTATE MARKET OF UKRAINE
Abstract
The subject of the study is the processes of the current state and the main trends in the real estate market of Ukraine. Methodology. The research was conducted using general scientific methods, in particular: theoretical generalization, methods of positive and normative analysis, statistical analysis. The goal is to analyze the processes of the current state and the main trends in the real estate market of Ukraine. Research conclusion. The main trends in the real estate market of Ukraine are highlighted. The legal features ensuring the real estate industry are determined: restrictions and simplifications concerning the functioning of the real estate market. Trends in the formation of real estate prices on the primary and secondary market are highlighted. The structure of the primary and secondary market by types of real estate planning and by types of housing was analyzed. It is emphasized that the buyers, as before the war, need compact quarters or mixed type of buildings of different floors, in which, in addition to housing, all necessary infrastructure is provided (grocery stores, cafes, pharmacies, schools, kindergartens, playgrounds, recreation areas, offices, etc.). However, due to the war, specific requirements are added to the standard ones, such as the safety of the complex, for example, the presence of underground parking adapted for bomb shelters, etc. The price of apartments has already increased, especially in hryvnia equivalent. The average price per square meter is higher than in February, 2022. The growth trend will continue in the post-war period. After all, the price is directly affected by the buying mood of customers, the weakening of the hryvnia against the dollar, the pace of construction recovery, and the remoteness of the region from hostilities. Taking into account the rising cost of construction materials and complicated logistics, the price per square meter for new construction projects will increase significantly. In addition, new players are entering the real estate market, such as temporarily displaced persons who have adapted and plan to stay, workers who have moved due to company relocations, and investors who have decided to protect their investments. The significant slowdown in the pace of construction, the lack of new facilities, despite weak demand, will lead to a certain shortage of high quality residential projects and, consequently, a shortage of comfortable and liquid residential properties on the market. Ukraine expects a decrease in the purchasing power of the population and, accordingly, a decrease in the opportunities to purchase real estate. The way to avoid these complications is the intervention of the state and local self-government bodies, for example, communal housing, which will belong to the community, can be rented on a long-term basis to vulnerable sections of the population, immigrants and those groups of people who need it but cannot afford to buy it.
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