Demand falling, prices skyrocketing. What is happening in ready housing market

Author

Lesia Solovchuk

In May, the demand for the purchase of housing in the secondary market fell throughout Ukraine, in the south and east by 90-100%. At the same time, in the regions farthest from the hostilities, prices for apartments went up.

According to the company LUN Misto, average prices for secondary real estate in May 2022 increased by 30-60% compared to October 2021, a decline in prices was recorded only in Kharkiv Oblast. Experts predict market stagnation until the end of the war.

Housing prices by region (Oblast)

In May, housing on the secondary market rose in price not only in the western regions of the country, but also in some eastern ones. Price increases were recorded in the following areas:

in Sumy Oblast prices increased by 122%;
in Lviv Oblast — by 64%;
in Ivano-Frankivsk Oblast — by 58%;
in Kyiv Oblast — by 55%;
in Zaporizhzhia Oblast — by 51%;
in Dnipropetrovsk Oblast — by 53%.

Demand and supply of housing for purchase

At the same time, supply and demand indicators in the secondary market have fallen over the past five months in all regions of Ukraine.

According to LUN, the supply decreased the most in Kirovohrad Oblast — by 92%, in Zhytomyr Oblast — by 86%, in Mykolaiv Oblast —by 85%, in Kherson, Cherkasy, and Chernihiv Oblasts — by 83%. In Dnipropetrovsk Oblast, the supply decreased by only 2%, in Kyiv Oblast — by 25%.

Demand for the purchase of housing in the secondary market, for objective reasons, decreased more in the eastern and southern regions: in Kherson Oblast — by 100%, Mykolaiv Oblast — by 94%, Kharkiv Oblast — by 91%, Odesa and Zaporizhzhia Oblasts — by 86%.

A significant reduction in demand is also recorded in some western and central regions: in Vinnytsia Oblast — by 73%, Chernivtsi Oblast — by 67%, Khmelnytskyi and Volyn Oblasts — by 62%.

Data for the study is not available in Luhansk and Donetsk Oblasts, as well as in the Autonomous Republic of Crimea.

Forecast: When real estate market stabilizes

As Yaroslav Tsukanov, real estate expert, explained in a commentary to , despite the fact that the registries are open and prices are rising, there are few sales on the market — until the end of the war, the market has shifted to rent.

"Since housing prices have fallen over the war and the complicated social situation of people, apartment owners prefer to postpone sales and rent them out. The same is with new buildings — they will be of interest to people only in the case of the final phase of construction. No one will now wait five years until the completion of the construction project," the expert explained.

According to Tsukanov, even if the situation is assessed in Lviv, Ternopil, and Zakarpattia, the situation is still better in terms of rent, and not in terms of sale.

"Significant changes in the market can only be predicted after the end of active hostilities and the revival of the economy and business, which will give people confidence in where they will live tomorrow, as well as the necessary resources," the expert explained.