Decline in housing prices for the Ukrainians «block»

11.08.2011 12:02
Real Estate Market Analysis | Decline in housing prices for the Ukrainians «block» Experts rule out a collapse in property prices in Ukraine. Substantial reduction in property prices in Ukraine in case of a second wave of financial crisis, the probability of occurrence is estimated as very low, will not.
"First of all, I want to note that the probability of occurrence in the near future a second wave of financial and economic crisis in Ukraine, in my opinion, is not high. Construction is a clear indicator of the economic situation in the country. And today the performance of the indicator suggests that in the construction industry are the stabilization process. So consider the possible influence of a possible second wave of crisis, I would have been a purely theoretical. If we talk about the cost of residential and commercial real estate, the collapse of prices per square meter, in my opinion, will not happen "- quoted by the" Interfax-Ukraine "statement by the Director of the Department real estate development investment and construction corporation" Avantage "Ivan Nekrasov.
He noted that developers today do not have enough money in reserve to afford a substantial price reduction. "So many developers are likely to prefer to pause and" mothball "projects, rather than sell them at a price below cost" - he added.
According to the president of the state corporation "Ukrmontazhspetsbud" Alexei Luganova, the situation on world markets, above all, may adversely affect the prospects for mortgage lending: banks are too cautious in granting loans and will take a waiting position, which, in turn, would increase the cost of borrowed funds . "At the same time, a significant adjustment in property prices is not going to happen. Do not fall in price and service general contracting companies, whose profitability, and so is at a minimal level ", - said A. Luganov.

Related article: In Kiev, home sales are starting to break records

Commenting on the possibility of influence of the second wave of crisis in the industrial construction market of Ukraine, Chairman of the Supervisory Board "Spetsstroymontazh" Leonid Krivochuprin noted that the main trend in this market with such a scenario could be a gradual decline in construction. According to L. Krivochuprina, in the case of the second wave of financial crisis investors will be forced to save money, that would lead to "curtail" projects, the start of which coincides with the beginning of the second wave of the crisis, while the objects more readily than 50%, rather likely to be completed and put into operation.
At the same time, the commercial director of PJSC "Real Capital" ("NEST"), Konstantin Bravo believes that the most likely scenario for the next six months will be to maintain stability in the world economy, all private and public institutions. "Therefore, we expect that the fall in the property market will experience a seasonal increase in demand, both for residential and commercial real estate, except for office space is medium in size - 100-300 sq. m. Prices in the primary market is likely to remain at current levels, perhaps a slight hesitation, "plus-minus" 1-2% of the cost of apartments in buildings under construction ", - predicts K. Bravo.
As the head of the National Council of Real Estate Boards Oleksandr Bondarenko, the cost of secondary housing in Ukraine, and excluding a possible second wave of the crisis will continue to decline by 1-1.5% per month during the year, while the second crisis could lead to a one-off reduction in prices by about 10 %, followed by monthly cheaper housing on the 1% level for six months.
"We are already on the brink. I think that extreme price fluctuations would not - the average price reduction on second homes will be 2% per month, and second homes at a cost to tighten the cost of the primary "- predicts the president of the Union of Realtors of Ukraine (SSNU) Alexander Rubanov.

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