At Kyiv housing market recovery of the Greatest shows a segment of the primary housing class «business» and «Business +»

25.02.2011 12:10
At Kyiv housing market recovery of the Greatest shows a segment of the primary housing class «business» and «Business +» February 24, 2011 consulting company RealEkspo conducted the business meeting on the residential and suburban real estate.

At Kyiv housing market recovery of the Greatest shows a segment of the primary housing class «business» and «Business +»Director of marketing and research at Knight Frank Natalia Pronin told about the situation in the residential property market in Kiev, as of today, we define the vectors of development and make predictions.

The main difference between today's primary residential real estate market from a previous crisis, and prosperous years, it's completely different dynamics of development of all its segments - the economy, business and elite classes of housing. In 2010, there has been a unique situation - one class showed slow but steady recovery, the other - stagnation, and the third - the correction in prices. In terms of sales and price indicators showed the most dynamic segment of a healthy business class. In Economy class continues to stagnate, and in the elite segment although prices are slightly, but reduced.






Key indicators of the primary housing market in Kyiv
Market segment
Average price, $ / sq. m

Changes in average price,%

IV quarter 2010
for IV quarter 2010
for 2010
Change from the beginning of the crisis (Q4 2010 / Q3 2008)
Class elites
7 460
Business class
2 198
+ 15,4%
Economy Class
1 341
According to Knight Frank

Structure under construction proposal suggests that the segment of the business of housing is going through a recovery period, as the rate of the number of flats about 50% of all proposals is exactly the class of business or "business +".
Anchored in the recent trend of competition between the primary and secondary market for housing is still relevant for the business segment, despite the fact that the offer of such a class is traditionally characterized by the presence of infrastructural advantages, good layouts etc..
During the crisis, market segments, business and economy has transformed into a buyer's market, which affects the pricing policy, in particular for economy housing. In the segment of economy class, where there are a number of problems generated by economic and financial crisis in the country (distrust of the developers, the risks of protracted, very limited and expensive credit, falling real incomes) stagnation in prices has a real and adequate reasons. To date, the average cost per square meter is still close to its minimum possible market indicators. However, prices should also not be expected, since in the coming year will not change a number of macroeconomic factors, which could support the demand and lead to a significant revitalization.
Of all the segments of the business class showed the largest decline in prices during the crisis. The maximum decrease in prices in this segment was recorded in the II quarter of 2009 - (- 44%) from peak values. But in 2010 the majority of newly passed business-class price increase that for the year reflected a 15% increase in th segment. In 2011, we do not expect significant changes in the index of the average price for the segment as the current forecast of growth of the market is quite able to meet demand and to support the total supply at an adequate level market.
Market luxury homes in Kiev traditionally has the stability and robustness with respect to changes in macroeconomic factors. Observed crisis fall in prices per square meter in the elite new not so much talking about falling prices for a quarter, much of the limited sample of such a proposal before the crisis and the excessive appetite of owners. The current price is adequate to the market and more competitive in comparison with the secondary market. Wait for it a substantial change in 2011 was not warranted. Possible fluctuations in the average cost of + / -5% can be justified by a greater degree of change in the composition of the sample, but no real changes in the market.
Primary housing economy class after the fall of prices in the secondary market continues to compete with them due to limited demand. The cost of apartments in new buildings is still relatively low.
Segment of the business class, where the proposal has already finished housing is limited and pre-existing advantages in terms of infrastructure and active marketing programs keep the market from a sudden change and maintain the interest of buyers. For this segment of the possible small increase due to increasing stages of completion of objects, but is likely to increase at some sites will also be compensated by the release of new projects with prices below the market average. Projected price increases in the range of 3-5% for the year.

Victor Kovalenko
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Content tags: Housing Kiev
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