NBU predicts further drop in housing prices in Kiev

НБУ прогнозирует дальнейшее падение цен на жилье в Киеве

The cost of housing and the number of transactions of purchase and sale in Kiev remain low and may continue to drop due to oversupply, as well as the ratio of the cost of renting and buying housing. This is stated in the December financial stability report National Bank of Ukraine (NBU).

According to the document, the beginning of November 2016 in the primary and secondary housing market of the capital, average prices in dollar terms decreased by 9% in annual terms and the average rental price per square meter in October and 11% in annual terms.

“The ratio of housing prices and rents (price-to-rent ratio) has remained relatively stable: it is 20-25% higher than before the crisis, indicating that housing in Kiev, maybe even slightly cheaper, or, less likely, the intensification of business activity in the capital will lead to an increase in the cost of rent,” the report says.

According to the NBU, in the first half, Ukraine had issued 685 permits for the construction of houses with two apartments or more, which is 54% higher than the same period in 2015. “The figure exceeded the minimum value and indicates a possible revival of investment in construction in the future,” I believe in the national Bank.

At the same time, in conditions of limited demand, developers in fight for the buyer to change the structure of the sentence, said the NBU. Thus, the average area of new apartments has declined from 76.2 per sq m in 2013 to 65.8 per sq m for the first nine months of 2016. “This is due to the increase in the proportion of one-bedroom (from 43% in 2013 to 52% in January-September 2016) and to a lesser extent by reducing the area of apartments, regardless of the number of rooms in them. This trend is evident both in Kiev and regions,” the report says.

News on topic: Growth of housing prices this year will continue due to the devaluation of the hryvnia and inflation – Mikitas

It is noted that the low housing prices in Ukraine as a whole, the lack of decline in some cities, slowing the fall in Kiev and the growth in the number of transactions of purchase and sale of residential properties and structural changes of the proposal indicate that the main phase of market downturn behind us.

Earlier it was reported that each potential buyer of housing in the capital has a few dozens of offers of apartments in different areas of the city. Fierce competition also forces owners and developers to attract buyers low prices. But the biggest “hunting” is for the so-called bargain offers, which cost an average of 30-50% below market.