Developers note a high demand for the eHouse program, but there are still not enough transactions to have a noticeable effect on the primary housing market, according to developers interviewed by Interfax-Ukraine.
“At present, the number of apartments purchased under the eHouse program in residential complexes under construction does not exceed 1%. For a more or less tangible impact of the state mortgage on the primary market, this figure should increase to at least 25-30% of the loans issued – up to 200-250 mortgages per month,” said Volodymyr Sementsov, co-founder and managing partner of INSPI Development.
Daria Bedia, Marketing Director of DIM Group, expressed a similar opinion. According to her, while there are not enough transactions under the eOselya program in the primary market, at the same time, installment offers from the developer are in demand.
“We do not believe in eHouse in particular because of the insufficient volumes in the primary market: when at least 300 loans out of 1,000 per month are issued in the primary market, it will feel a certain effect. However, we have hopes for compensation certificates for destroyed housing. They can give an incentive to the market recovery next year,” the expert believes.
According to her, DIM has increased the number of financial instruments for buyers, including long-term installment programs for up to seven years, exchange rate fixing, and discounts. The company also offers individualized installment terms and discounts for military personnel, including installments in hryvnia without reference to the exchange rate and free white box finishing.
KAN Development also offers special conditions for purchasing housing in its projects, including long-term installment plans from the developer. The company noted a small number of transactions under the eOselya program, while the developer has already received the first requests for housing under the housing certificate program.
Demand for ready-to-move-in apartments in Ukraine’s primary real estate market is gradually growing, with their share in the sales structure of some developers reaching 50%, according to a survey of developers conducted by Interfax-Ukraine.
“Before the full-scale war, the share of renovated apartments from the developer was about a third of total sales. Now it is up to half of the transactions. The demand for owner-occupied apartments is growing. Firstly, it is cheaper than finishing the apartment yourself. Secondly, it is much faster. You can move into a new home immediately after the building is completed, while renovation work done by yourself takes at least several months to six months. For many people, this factor is critical,” said Anna Laevska, commercial director of Intergal-Bud.
According to her, Intergal-Bud offers buyers a finishing of the apartment (flooring, wallpaper for painting, interior doors, electrical wiring and electrical fittings, plumbing) with designer renovation in three styles, as well as installation of furniture and kitchen.
Ms. Laevskaya noted that over the past year and a half, the company has revised the prices for the renovation service several times. Today, the cost of designer renovation is $300 per square meter, which is $100 lower than before the full-scale war. A furnished repair from the developer will cost $600/sq. m.
“We understand that renovating an apartment in a new building is a big expense. In the context of exchange rate fluctuations, when everything around us is getting more expensive, a democratic price offer from the developer is a step towards Ukrainians who want to improve their living conditions. We have no plans to revise the cost of repairs, but we understand that further developments will depend on the prices of materials,” the expert said.
According to DIM Group, the share of ready-made renovated apartments in the structure of demand in the primary market is 45%.
“The advantages of a renovated apartment from a developer include maximum transparency and accountability. The buyer delegates to the developer the supervision of the order fulfillment and already accepts a fully finished product at the stage of receiving the keys,” said Daria Bedia, DIM’s Marketing Director.
The developer offers four types of finishes in its projects: basic renovation at a cost of $650/sq. m, kitchen with appliances – an additional $50/sq. m to the cost of basic renovation, cabinet furniture – “plus” $30/sq. m, upholstered and separate furniture – “plus” $20/sq. m. DIM engaged Anthracite design bureau to develop the renovation projects.
“We set ourselves an ambitious task: to overcome the prejudice that a renovated apartment in a new building is always about a typical renovation with budget materials, the same colors and style. Our partner has developed a whole line of adaptive design projects that differ in style, color scheme, content, and price,” Bedia explained.
Meanwhile, apartments with ready-made repairs are not in demand in business-class residential projects and are more relevant in comfort and economy class, according to City One Development.
“Based on many years of experience and analyzing customer requests, we can say that it is impractical for a developer to make ready-to-move-in apartments in the business segment. The vast majority of our clients choose apartments for themselves and want to choose and develop the design themselves. Renovated apartments are relevant in the economy and comfort classes. But this is no more than 5% of the total demand,” says Dmytro Novikov, Marketing Director of City One Development.
Among the disadvantages of finished apartments, Novikov mentioned the higher cost, longer terms of obtaining housing and mostly standard design solutions that do not take into account the individual request of the buyer.
According to him, the experience of sales of the first and second phases of Novopecherski Lypky showed that the most popular renovated apartments were one-bedroom apartments, while two- and three-bedroom apartments were sold less actively.
“So far, we have not received any requests for ready-made renovated apartments from the developer. Customers continue to be interested in finished apartments even at the final stage of construction, which means that the trends that emerged with the outbreak of the war continue to exist,” he summarized.
The growth of effective demand in the “comfort+” category in the capital region is 3-5% per month, said Daria Bedia, Marketing Director of DIM Group of Companies.
“In liquid projects in the comfort+ category in the price range of $1300-1500 per square meter with stable construction dynamics and a high-quality concept, the monthly increase in effective demand is 3-5%,” Daria Bedia told Interfax-Ukraine, citing data from the company’s analytical report.
According to her, the positive dynamics since the end of spring is a good signal and indicates that buyers are now ready to invest in a comfortable and safe living environment in Ukraine that will fully meet their requirements and expectations.
These requirements, according to Bedi, include a well-thought-out concept that takes into account different life scenarios in both the spatial zoning of the territory and the filling of functions. A diverse multifunctional infrastructure that reflects the expectations of the target groups of buyers, a well-thought-out apartment layout and a variable range of planning solutions, energy independence of the complex, in particular, the availability of alternative power sources for water supply or power for elevator equipment, a customer-oriented service company and an access control system are mandatory.
“The level of demand is directly influenced by the concept of the project itself, the stage of construction, and especially the real construction dynamics at the site, the developer’s reputation, and flexible purchase terms, both in installments and 100% payment,” explained the marketing director of DIM Group.
Today, most buyers in the comfort+ segment are interested in one-bedroom apartments of 40-47 sq. m. with a kitchen-living room of 20 sq. m. and a separate bedroom with a dressing room. The top two-room apartments are 68 to 75 sq. m. with two separate bedrooms, a kitchen-living room of 20 sq. m., three-room apartments of 85-90 sq. m. with three separate bedrooms, one of which is a master bedroom with its own bathroom and wardrobe, a large kitchen-living room is also a priority.
Daria Bedia added that transactions for the purchase of business class apartments with an average price of $2 thousand per square meter have become more frequent in the primary real estate market. At the beginning of the fall, business class accounted for 25% of sales, although in the spring this figure was 15%.
DIM Group was founded in 2014 and consists of six companies covering all stages of construction. To date, it has commissioned 12 buildings in six residential complexes with a total residential area of over 218 thousand square meters. Six residential complexes of “comfort+” and “business class” categories are under construction: “New Autograph, Metropolis, Park Lake City, Lucky Land, etc.
DIM Group of Companies has joined the program of restoration/compensation of destroyed housing from the Ministry of Community Development of Territories and Infrastructure, the press service of the company reported.
As reported, from November 5 begins the issuance of housing certificates for exchange for new housing for Ukrainians whose housing in the non-occupied territories as a result of Russian aggression was destroyed. Objects for the purchase of housing on certificates can be already built or objects at the final stage of construction.
DIM Group of Companies will work with all financial institutions that will lend under the state programs, these are state banks, Oschadbank, Sense, PrivatBank, and commercial banks.
Ukrainians will be able to realize their housing certificates in the residential complexes Metropolis and Lucky Land, located in Kiev and the countryside complex Park Lake City in the village of Podgortsy, Kiev region.
As it was reported, since August 1 in “DII” started accepting applications under the program “eVidnovolneniya for compensation for housing destroyed because of the war. Compensation will be paid to sole owners of housing, which was destroyed due to hostilities after February 24, 2022, is not subject to reconstruction and is located in the non-occupied territory and not in the zone of active hostilities. As of the beginning of November, more than 5 thousand applications for compensation for destroyed housing have already been received, and a fifth of them have already been processed, having approved the issuance of 422 housing certificates for a total amount of UAH 811 million.
DIM Group was founded in 2014 consists of six companies covering all stages of construction. To date, it has commissioned 12 houses in six residential complexes with a total residential area of more than 218 thousand square meters. Six residential complexes of “comfort+” and “business class” category are under construction: “New Autograph”, “Metropolis”, Park Lake City, Lucky Land and others.
The cost of construction and installation work in Ukraine has increased by 35% since the beginning of 2023 amid a shortage of personnel that has reached 40% in some companies, Oleksandr Nasikovsky, managing partner of DIM Group, told Interfax-Ukraine.
“There is a real shortage of highly qualified personnel. Today, there is an acute shortage of monolithic workers, crane operators, painters, and electricians. In some markets, the shortage in companies reaches 40%, which significantly affects the industry. Since the beginning of the year, the cost of construction and installation work has already increased by more than 35%, which is due to both inflation and a shortage of personnel. I think we will see growth of at least 5-7% in this category by the end of the year,” he said.
Nasikovsky emphasized that the availability of labor and skilled personnel is critical for the recovery of Ukraine, where more than 170,000 residential buildings, 19 airports, approximately 130 railway stations, 3,400 educational institutions and other facilities have been damaged or destroyed. Ukraine is facing an important challenge to ensure the availability of skilled construction workers to rebuild and develop the country, and this requires decisive action and support at all levels.
“We really need a system of motivation at the state level that would encourage young people to study for production specialties and support those who choose the construction industry for professional realization. It could be social incentive systems (social mortgage programs, for example) or additional financial incentives,” Nasikovsky said.
DIM Group was founded in 2014 and consists of six companies covering all stages of construction. To date, it has commissioned 12 buildings in six residential complexes with a total residential area of over 218 thousand square meters. Six residential complexes of “comfort+” and “business class” categories are under construction: “New Autograph, Metropolis, Park Lake City, Lucky Land, etc.
Since the beginning of autumn, the primary real estate market has seen an increase in transactions for the purchase of business class apartments with an average price of $2 thousand per square meter, Daria Bedia, Marketing Director of DIM Group, told Interfax-Ukraine.
“According to our analysts’ research, business class now accounts for 25% of the sales structure, although this figure was 15% in the spring. Such signals are encouraging, so we expect an increase in demand this fall. Of course, everything will depend on the news at the front, the frequency and consequences of shelling in the capital and possible power outages. We are also well aware that this category of buyers is likely to leave Ukraine for the winter in late fall,” Bedia said.
According to her, the level of demand is directly influenced by the project itself and its concept, stage and activity of construction. Important criteria include the developer’s reputation, ability to keep its word in terms of deadlines and promises, as well as flexible purchase terms in case of 100% payment and installments. Much attention is paid to the type and quality of materials, spatial zoning, landscape design, service company, security and concierge services. People who choose business class value a sufficient number of parking spaces and an underground parking lot with an elevator to the residential floors.
According to DIM Group analysts, apartments with the correct layout are in high demand, more often either classic layout solutions or Euro-formats with spacious kitchens-living rooms and isolated private rooms.
The area of one-bedroom apartments, which are most often bought in the business segment, reaches 50-55 sq. m, two-bedroom apartments – 75-80 sq. m, three-bedroom apartments – 100-120 sq. m. According to DIM’s Marketing Director, the mandatory attributes of such apartments are a large living area with panoramic windows of 30 sq. m. or more, a master bedroom with a dressing area and a separate bathroom of 20 sq. m., and a children’s room of 25 sq. m. or more with a wardrobe.
At the same time, the tendency to reduce the average area of purchased apartments continues.
If earlier, according to her, in the business class were interested in three-bedroom apartments in the range of 120-150 sq. m., now up to 120 sq. m.; while two-bedroom apartments are now more in demand in the range of up to 85 sq. m. against 85-100 sq. m. earlier. Only the demand for one-bedroom apartments has not changed at the level of 50-55 sq. m.
“The average area of apartments in terms of demand decreased by 10-15%. But the bulk of the sold objects were designed before the war, so developers still have large apartments that are not very interesting to buyers. After all, the total purchase receipt is more important nowadays. Therefore, developers offer more flexible terms for large apartments in terms of installments and discounts,” Bedia summarizes.
DIM Group was founded in 2014 and includes six companies covering all stages of construction. So far, it has commissioned 12 houses in six residential complexes with a total living area of over 218 thousand square meters. Six comfort+ and business class residential complexes are under construction: “New Autograph, Metropolis, Park Lake City, Lucky Land, etc.
