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Market analyst Viktoriia Bereshchak shared in an exclusive commentary with the editorial staff of Novyny.LIVE what buyers and sellers should prepare for in 2025.
The real estate market has encountered significant challenges due to the full-scale war. The consequences have not yet been fully overcome, considering the rising cost of housing, reduced demand, falling real purchasing power, and so on.
What will happen to prices in the primary market
It is difficult to predict the situation in the long term, as the market reacts to geopolitical events. This includes, in particular, the newly elected US President Donald Trump and the policy of his White House. Based on objective factors independent of the international arena, it can be assumed that the average weighted price increase will be a maximum of 15% per year in total.
The cost of construction in 2023 increased by at least 45-47%. This refers to the rising costs of materials and construction and installation works. At the same time, we have practically zero demand for real estate. In certain segments, it is concentrated at the level of up to 20%. And this is only under a combination of factors,” noted the expert.
This includes a good reputation of the developer who continues to build and fulfill their obligations, despite regular missile attacks, damage to energy infrastructure, etc. It also includes the product matching consumer expectations, which have begun to focus on:
- multifunctional quarter-clusters;
- closed-type recreational complexes with a mix of infrastructure.
Buyers will face rising real estate prices in 2025, provided that the situation in the market remains relatively stable. The 15% forecast may be adjusted upwards if there is a loss of production capacities in various construction material sectors. Or in case of mobilization processes that will exacerbate the shortage of skilled workers.
I believe that 2025 will be decisive for developers. We will clearly see who has the potential to continue staying in the market, develop, and be a full-fledged player, and who has begun their path to self-destruction or, in other words, a voluntary exit from the market,” stated Viktoriia Bereshchak.
What to expect in the secondary market
The secondary real estate market is generally dependent on the human factor. If there are new internal migration shifts, both rental and purchase-sale transactions will liven up in the regions. Large hub cities, particularly Lviv and Kyiv, have more active markets. As practice in 2024 showed, taking into account the dollar exchange rate and other factors, an increase in the price of liquid one-room apartments by 10-12% and two- and three-room apartments by about 6-8% per year is possible.
As for the eOselia program, it may remain a driver if there is sufficient funding. Moreover, stable funding, without revisions to decisions on allocating funds. It is necessary to allocate at least 17-20 billion hryvnias annually for eOselia,” added the analyst.
However, one should consider the purchasing power of Ukrainians. It has decreased because people are psychologically not ready to invest large sums in square meters due to the uncertainty of events in the geopolitical arena around Ukraine. An optimistic scenario would be if it is possible to return at least 10-15% to the overall demand structure, i.e., in sales.
The expert is confident that developers will not find the means to reconfigure their business processes to avoid being solely dependent on buyer money for continued construction. It is necessary to seek investment partners interested in building residential properties. If companies do not start cooperating with international players who are eyeing the Ukrainian market because they see its potential after victory, there will be a reformatting of developers’ activities in the worst sense.
Date: 30.12.2024 Source: Novyny.LIVE