High season for real estate: the price of crush “communal” taxation and the growth of the minimum wage

Late winter — early spring, usually wakes up and the real estate market. Comes the so-called high season, which usually lasts until Easter and may holidays. This year it has its own characteristics, associated with an increase in the minimum wage, taxes, rising utility bills, the condition of the housing stock built prior to 2000, etc.

On them we told the head of the Lviv branch of the Association of realtors of Ukraine (ASNU) Andrey Borisov, an analyst with the consulting company SV Development Sergey Kostecki, President of the Association “Land Union of Ukraine” Andrew Koshil, head of the Nikolaev regional office ASNU Andrew Oleinikov, the head of Kharkiv regional office ASNU Alex Popov and the Director of realty company “Golden gate” Alex Holmetsky.


Ask the student who has just started to study macroeconomics: what leads to the increase of salaries? He immediately chop: from income growth follows the increased demand for basic goods and, if the proposal will not have time to respond adequately increase prices. But held not so long ago in Ukraine, a doubling of the minimum wage, by contrast, was one of the factors reducing demand for property!

Behind the apparent paradox — specific logic: those whose income increased due to increase of the minimal wage, can hardly be attributed to real buyers of houses and apartments. But those who theoretically could acquire the property — owners of small and medium business, sticking with the salaries of the staff of the official practices of the minimal wage and salaries in envelopes, thanks to this innovation tax real income just decreased. And many are not up to major acquisitions.

MARKET WORSE. Especially because at the same time and raised the offer. “The market is getting worse, — says Sergey Kostecki. The estate tax increased, “communal” is expensive. And if before the apartment could just stand empty, now it is expensive”.

Accordingly, many new proposals appeared on the rental market and sales market. According to Kostecki, if in Kiev last year, the offer for sale of 40-50 thousand apartments, now the market offers almost 60 thousand objects.

However, this is not true of all large cities — in some cases, can play any specific regional factors. For example, according to Alexei Popov, Kharkiv “urgent” proposal on the secondary market even fell. The fact that in recent years the increase in supply was played by the proximity to the homes of hostilities. The part of apartment owners, after watching the news, came to the view that will be quieter to move somewhere West. Now all is particularly alarming already moved and the rest have you the existing state of Affairs.

“Moreover, there will be demand from immigrants from Donetsk and Lugansk regions, — says Alexey Popov. — People who have lived here in rented apartments, accustomed to town, found a place here and ready to stay.”

OKAY. I must say that in comparison with the failure of the 2014-2015 real estate market looks quite alive. The more that the participants have become accustomed to is not too high activity.

“Potential buyers, according to the filings, quite a lot, — says Alexei Holmetsky. Just commitment to purchase is low — people have nowhere to hurry. Should be a push. And as soon as the price increase this mass rush to buy.”

But while prices in most regions remain virtually stable, with a slight downward trend.

Can’t afford it. The growth of “communal” property tax made empty apartments too expensive


Among the main criteria when choosing an apartment is its price and liquidity. That is how simply, quickly and without losses (and better — even with the income) we will be able, if necessary, to sell.

“The IMMORTAL”. For example, in Lviv constant demand for good apartments in old houses (Polish or even Austrian buildings) in the Central areas of the city. Here is the value and quality of construction of these buildings, which is a far the fruits and the Soviet, and modern builders. Important is the environment where the house is located.

“It must be a street is an architectural ensemble, where, obviously, there will be new buildings,” — says Andrei Borisov.

Besides the apartment immediately after purchasing you can rent — or long-term, which is much cheaper rent.

With all the problems in the rental market, the demand for such apartments remains high, which makes these objects highly liquid.

Are such a class apartments from $1200 per sq m and above. For comparison, the Czechs in the outskirt districts of the city are two times cheaper — about $600 per sq. m.

AND NOT VERY MUCH. For reasons of liquidity, experts advise caution over buying a very cheap apartment (gostinka, Khrushchev). When the market will go up again, these apartments will go up much slower than their more modern and comfortable colleagues, if at all. From similar reasons many experts lukewarm speak about investing in the “smart apartment.”

PRICE. “As always, buy the cheapest, — says Alexei Holmetsky. — That is to sell the apartment should be cheaper than their analogues”. Of course, the idea of “proper” pricing differs from city to city and from area to area within the same locality. In Kharkov, for example, a decent 1-bedroom (32 sqm) in a nice area near metro is available for $24-25 thousand, and in more remote — for $19-21 million In Nikolaev similar unity in a good location going for $18-20 million, and on the edge — $12 thousand


The market produces an ambivalent impression. On the one hand, I want to enjoy it activity: build a lot like the current difficult times, not only in the capital and its surroundings. “In Nikolaev significant activity in the purchase of apartments in new buildings”, — says Andrey Oleynikov. Vengeance rising new buildings in Kharkiv, Lviv, Odesa, Zhytomyr and other cities.

According to realtors, the demand for new housing is supported by problems in the banking sector and the almost complete lack of alternative ways of investing in Ukraine. New, in the sense of investing money, you have to similar objects of the secondary market as a minimum the advantage in price. In addition, most of affordable apartments in the secondary market relate to the old, rather worn and not too high-quality housing.

BUBBLE. On the other hand, some specialists are alarming visible signs of “bubble market”. In particular, as pointed out by Sergey Kostecki, in recent years due to the cost of energy, metal, growth of wages and similar cost of construction has increased markedly, and the prices of apartments in new buildings does not reflect this growth.

As a result, the profitability of construction projects often reached a critical low: housing is constructed as “with reserve”, the number of transactions has not kept pace with the emerging number of new apartments and houses are half empty. This is especially noticeable in the Metropolitan area. Downside — frequent delay in the delivery of houses. The companies do not have enough funds to build a “full capacity”, the number of sites are conducted only formally, and new projects begin, only that through the sale they have the opportunity to finish what has been started.

Delay. More objects are “frozen” in its construction


Says Sergey Kostecki, in contrast to apartments, at home we never bought to rent out — at least in any appreciable quantities. Therefore, no increase in “communal” or increased taxes or the difficulty of renting did not lead to release to the market a large number of objects. “The supply of homes increased, but not significantly, — says Sergey Kostecki. Is a slightly different market, and it is more stable”.

AREAS. With the ground the situation is different. At the time, those who had the opportunity, by hook or by crook stocked land, believing that as the inevitable growth of prices for it they will do great business. But then came crisis after crisis, and instead of the longed-for profit areas began to bear the expenses of the same land tax. “The owners want to rid their lots, says Andrew Koshil. — It is ready to go to all sorts of concessions”. On the other hand, demand is low: people who can afford the construction, becomes smaller. So now is the time when there’s a chance to buy land on very favorable terms.

SAVINGS. “If earlier the plots were estimated according to the price per hundred square meters, now the greatest demand is for plots price to $20 thousand Even if it is very small area, but there is communication and a normal entrance, he would prefer, says Andrew Koshil. — It is possible to build a cheap house in a quick and “warm” technologies and to alternative apartment. Especially with the increase in utility bills people want to pay less. If the buyers wanted the presence of gas in the area or the possibility of its connection, today considered the other options of heating — solid fuel boilers, heat pumps etc”.

Not to say that the Exodus of citizens has the scale of the visible tendencies, but such examples are increasingly. “People sell the apartment, get a small portion and begin to build their own, — says Koshil. Or when the family are leaving the rest of the money investing in construction. As a rule, builds the team, and then the family on their own gets the object”.

Demand. Most popular small plots the price to $20 thousand from the porch and communications


“Are you going to sell the apartment. Of course, you see how much sold the same as yours. And I see that there are apartments for $30 million, and there is a $40 million — describes a typical situation Alexey Holmetsky. — Thinking, you take a Solomonic decision and put its price at $35 thousand as average. And that’s a mistake.”

The sad truth is that often those who put the apartment for 30 thousand And that they will be treated as options. “Also will offer to reduce the price to $28 thousand And only if no one will give it to you for $28 million, and to purchase necessary — will take over 30 thousand So there is a market,” says Holmetsky. Popular same strategy: “I will put up more expensive, not to miscalculate, and to reduce the price always will” — often leads to loss of time and money.

EXPIRED. “The apartment is desirable to sell in a short time, — says Alexei Holmetsky. — A common misconception of the seller if you will take longer to sell, more selling.”

But the situation on the market is that new customers are added slowly and gradually. And the old ones see that the apartment hanging for months, and lose interest in it. And in time it stuck, maybe it’s something wrong? Otherwise, why is it no one is interested? Indeed, as noted, the most desirable it becomes flat, if called on the relevant announcement, and was told that she was already out on bail. And when there is something fresh, it is immediately interesting.

“And if you “overexpose” the apartment, she becomes uninteresting. In the end, you have to sell it even cheaper than if you just put an adequate price,” says Holmetsky.

PRORING. Unfortunately, the simple algorithm “I saw the lowest price — to put the same” is also not working. Just because a huge number of ads on the Internet — debris, for which there are no real offers.

For example, many real estate agencies such sverhprivlekatelnym suggestions just “catch” customers. You call on the phone, and you regret to inform that “just what this wonderful apartment is gone, but you do not worry — we have another also good options!”.

Therefore, in order to get an idea of real prices — you have to get on the phone and make dozens, if not hundreds of calls. Or that it is easier to contact a good Agency that is characterized by the fact that its employee working in your area makes these calls constantly and generally has a complete idea of what and at what prices are buy.