Before the full-scale invasion, the Odesa real estate market was developing very actively and was extremely attractive to investors not only from the southern region, but even from abroad. A large selection of objects in different price segments, from smart apartments to multi-level penthouses with a view of the sea, has made Odessa one of the centers of real estate investment.
The last two years have changed the lives of millions of Ukrainians, which has affected the real estate market in Odesa. "ElitExpert" spoke with Vitaly Boychenko, deputy head of the first branch of the "SLON" real estate agency in Odesa, about the situation with the sale of apartments, the stability of Odessa developers and the risks of investing during the war.
Vitaly, what is the general situation in the construction market of Odessa today?
Most of the construction companies that worked in Odessa before the war are still working today. Construction activity, of course, has decreased, developers are more focused on completing projects started before the war, but in general the market is working. This is evidenced by the opening of new real estate agencies in Odessa.
Aren't people afraid to buy apartments in Odessa now, and which properties are selling best?
No, people are no longer afraid to buy. If two years ago the market simply froze, now it is returning to pre-war indicators in all price categories. Last year we had deals even for 500 thousand dollars and above: these are elite objects on French Boulevard and in Sauvignon.
Demand and supply ranges from $15 for a small apartment to homes worth $200 to $500.
Now the most actively sold segment is from 20 to 50 thousand dollars, but it was like that before the war. A significant percentage of people have enough money for this segment.
Who is the main buyer of real estate in the last two years?
These are both Odessans and people from other regions who moved to our city because of the war. Many people buy apartments under the state lending program "eOselya". It allows many civil servants (military medics, police officers, emergency workers, teachers and researchers) to get a loan for the purchase of real estate at 3% per annum for up to 20 years. The military servicemen who serve under a contract in Odesa and some other regions of the country are compensated by the regional administrations for this 3%, and such loans are generally 0% per annum.
For the rest of all categories of citizens, "eOsel" is 7% per annum.
What is the advantage of this program — the first payment requires only 20-30% of the cost of housing, you are loaned by the state and the loan itself is issued in hryvnia without reference to the dollar exchange rate. Therefore, people buy both for themselves and for investment.
In addition, the size of the monthly payment is approximately equal to the amount of rent if such an apartment is rented or rented. One of our clients, a teacher from Kropyvnytskyi, bought an apartment in Odesa under this program, rented it out to tenants, and the rent fully covers her monthly loan payment.
Who is mostly selling apartments now?
There are currently three categories of sellers. First, those who decided to leave the country altogether, and there are quite a few of them. There are also those who remain in the country, but move to calmer regions. And the third category is "family sale"; for example, the children have grown up and need more space, or the grandmother died, but the apartment remained, etc.
In addition, such "family sales" have recently become more active. We have been living in a state of war for two years now, and many of those who put these questions on hold at the beginning of the war are now both buying and selling. People realized that life goes on even in such a difficult time.
Is it possible to consider buying an apartment in Odessa as an investment today?
Because of the war, investors became 90% less than before. Many withdrew their investments from Ukraine and Odesa, but there are those who are ready to invest. As before, there are still small investors who have 5-10 apartments in the city for rent.
It is clear that before the war there were investors who bought entire floors from developers - these have decreased now. But the construction companies themselves are working less actively today for many reasons. In addition, the owners of construction companies themselves are a little afraid to launch new projects because of the risks and unknowns.
What do you offer the investor and what are his risks?
First, we do not recommend investing in an unfinished house, it is really a risk, and we, like everyone, do not know what will happen tomorrow. Therefore, we suggest investing in houses that have already been rented out.
We also offer entrepreneurs who specialize in renovations "killed" apartments - for example, "Khrushchevka" for 18-19 thousand. They already have a price, they understand how much the repair will cost, invest 5-6 thousand dollars in it and then sell it, earning 4-5 thousand on such an apartment. And we have such clients both in the secondary market and in new buildings.
In general, now you need to think carefully before investing money; to understand how long a person is ready to wait and what amount to risk.
What is today's average price for new and second-hand buildings in Odessa?
At the beginning of the war there was a very strong fall in the market, but today prices have practically leveled off to pre-war levels.
There are people who need to sell urgently, they lower the price below the market and sell quickly.
Regarding prices, we specialize more in Cheremushki, and there on the secondary market today a one-room apartment in normal condition will cost 25-28 thousand dollars. If we take a new building, then a renovated one-room apartment costs about $50 or more.
But, nowadays, you can start even with 5 thousand dollars. We currently have such projects from private developers, apartments already in this building, with ready repairs. And with five thousand you will already have your own home, paying the rest of the amount in notarial installments.
If we talk about developers, has the trend changed, what people pay more attention to - quality, price, or floor space and location of the house?
Currently, there are approximately equal numbers of those who do not want to buy high floors and those who are ready and want to live on 20-25 floors.
As for developers, today people are most worried about finishing the existing facilities.
Before the start of the war, many people invested their money in objects at the excavation stage, and now there are construction companies that have frozen or are building their houses for a very long time. And this, of course, is extremely unpleasant for people.
It cannot be said about some companies that they have everything completely frozen, but some developers have such objects - for example "Prostranstvo", "Budova". Although, on the other hand, "Budova" was one of the fundamental construction companies on the Odesa market before the war, its people knew, invested, and now have complex objects.
Who do you absolutely not recommend to your real estate clients right now? And what are your recommendations for developers who have built only 1-2 houses?
As for the latter, everything depends on how it was built, what people's feedback is. If people say that everything in the house is of high quality and reliable, we will recommend it to our customers. But if it is a one-time built house, and it is in a deplorable condition, there is no management company, and everything is not transparent, we will not recommend such developers.
The client's safety and our reputation are important to us: that a person then brings his relative, friend, or acquaintance to us and recommends us.
As for the builders of the city, before the war they all built steadily and actively, all of them had a certain reputation. Now many have difficulties and we would like more openness from construction companies. That they tell and explain to people why this object is being built today, and the other is not; so that people understand what actions are being taken so that they do not lose their invested funds.
In general, we do not have a "black list" of developers, we look at each specific object: if there is a question about it, we do not offer it to our clients.
And finally, share some advice for people who come to you to buy real estate - what should they look for?
We never insist that a person buy a home exclusively with a realtor. If you already have the experience of buying and selling, you understand in which area you want to live, which apartment you want - you can do everything yourself.
On the other hand, if you don't have a clear understanding and experience in that area, then working with a realtor, he himself refines your request, explains the pros and cons, and can even suggest repairs. After all, we, for example, cooperate with companies engaged in repairs, we know how much a square meter of repairs costs, and we can calculate everything - both the cost and the terms.
Our task is a complete package, right down to the fact that we hand over the keys to you, and the apartment is already clean and tidy.
In addition, we very carefully study all innovations - both in legislation and in lending programs. For example, our longest agreement with "eOseli" lasted two weeks, while it can last one and a half to two months for competitors. We showed the person ten apartments, and while she was deciding, we had already prepared the entire package of documents, worked through all the issues with the bank, conducted the necessary checks and were ready for the deal.
Our agency has been operating on the market for 6 years, and we already have enough recommendations and clients, due to which, among others, we continue to work successfully.
Olena Ovchinnikova spoke
