Builders overestimate the prices of apartments

12.10.2010 16:35
Articles about real estate | Builders overestimate the prices of apartments The Prime Minister has finally agreed with the majority of Ukrainians that developers inflate the price of the apartment. And instructed officials to find and punish those responsible. However, as they have long known, and without any investigation - this is just greedy builders themselves, and the same civil servants.

Prime Minister Mykola Azarov has finally figured that the Ukrainian developers continue to inflate the prices of apartments being built. So he instructed an interagency task force headed by Deputy Prime Minister Viktor Tikhonov to deal with the pricing in the construction industry on the whole complex components, ranging from land allocation, writes

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"We need to reverse the situation in construction", - said Azarov, and noted that construction companies overestimate the cost of operations, thus limiting demand. A decline in demand does not give resources to continue building - a vicious circle. "So I am instructing the Minister of Regional Development and Construction Yatsuba, SLC, regional administrations under the authority of the Vice-Prime Minister Tikhonov uncompromisingly deal with pricing in the construction, the cost of land and hedges on land allocation for construction", - concluded the Prime Minister.

Construction and assembly mystery
According Minregionstroya mediated cost of building in the Kiev region of 4.8 thous. per square. m, in cities of over one million - about 4 thousand UAH. per square. m. "But the numbers have nothing to do with the cost of the commercial construction industry. This indicator is designed for public procurement ", - explained the deputy minister Dmitry Isaenko. According to him, to get the average market cost, to add to this sum, about 25%. True, capital market players believe that you need a little more - about $ 1 for every thousand square meters. m

It should be noted that pricing in the building - is a closely guarded secret, to which outsiders are not allowed in principle. And if they are allowed, then to understand the specialized terminology is practically impossible. Simplistically divided the cost of housing for construction and assembly work (CAW), and other expenses. According to the director of the company TMM Mykola Tolmachev costs of SMR, ie, costs associated solely with the construction of the building, the cost structure occupy about 70%.

Under other expenses (30%) means the laying of the infrastructure, resolving problems with land acquisition, payments in favor of the city, etc. So, in contributions to appear: 10% of the estimated project cost - unit involved in the development of city infrastructure (deducted money) and about 5% of the total residential area (donates apartments).

A lot of problems with the builders laying the infrastructure. Company-monopolist "Kievgas and Kyivvodocanal" in technical terms, which give developers, do not be shy. Connect to existing networks is possible only for more singles. In other cases, networks are already overloaded, so builders continue to recommend new ones. At the time, Basil Mozhar as president of HC Kievgorstroy ", complained that the planning of the next 100 thousand square meters. m of housing in Poznyaky faced with the problem of connecting them to electricity.

But there Kyivmiskbud "- the minister of regional development and construction of Vladimir Yatsuba in the process of taking the Koncha Zaspa his home area of 600 square meters. m want to remove from the windows de-energized pole. "Since I asked to pay 70 thousand UAH!" - Outraged and he adds that every structure in Kiev has a lot of opportunities for extortion. He has already asked the builders to gather facts to detain the issuance of documents and other irregularities. Once the process of evidence gathering is completed, Yatsuba plans to immediately contact the Attorney General.

Zemleotvodnye problems
Land developer can get in several ways: through the auction, according to the decision of the local council and acquiring corporate rights in the secondary market. According to the president of the association "Land Union of Ukraine" Andrew Koshil, auctions are the most transparent mechanism for buying plots and gives a clear idea of pricing. But the process of legal regulation is not yet complete, so that local councils are afraid to hold them. "Law enforcement agencies leaves a loophole to make a claim" - he says.

To get put through the local council must pass two sessions and bypass a lot of classrooms. Experts find it difficult to say what steps must first be taken to facilitate this procedure, because the bureaucratic machine in this case operates at maximum load. For example, the management of the State Committee in the Zaporozhye region in August issued an order committing "a wholly voluntary passage of" land management expertise. The procedure itself is not so costly as unnecessary because the law clearly established that it held only in cases of demarcation between the settlements, land and special forces, etc.

Therefore, developers often try to avoid contact with deputies and prefer the secondary market. But even here all is not well. According to lawyers, to find the net from a legal point of view of plot (especially in the capital) is practically impossible: somewhere nearby residents oppose the building of houses, somewhere - a protected area, where some have put two of the owner. Tiny land in good locations are selling very expensive, which affects the final estimates.

There is still an option to build housing on departmental lands, but then the owner of the site will need to pay flats of 10-20% and sometimes 30% of the total floor area of the project. "Ideally, the city council on the basis of the general plan should put land up for sale with a clear indication of the parameters that there must be built", - said A. Koshil. To achieve this, we must not only weaken the appetite for government officials to make changes to existing legislation, but also complete land registry, which has been under development for seven years.

Appetites Builders
D. Isayenko recognizes that there are problems for developers, but does not consider their reasons for stopping the construction industry. "To market to work, need money," - he said. In his view, simplify the licensing documents helps to activate the market, but to a lesser extent than a good investor.

It should be noted that not only stimulate the growth of official extortion costs - blame themselves developers. For example, one of the capital developers, recalls how before the crisis were construction works. "Before the concrete had to be ordered in three weeks. On the appointed day arrives mixers and builders, it is not yet needed. Well, not before they reach the necessary steps. What should I do? Will not interfere with the same car for days and wait for the concrete workers. Usually just poured concrete on the side and order a new "- he says.

Additional costs developers a little worried about: the price of housing has grown every day. Often the builders did not even know what will be the final cost. Moreover, many of the players to develop their business on the principle of a pyramid: raised for construction of the house money is invested in the purchase of land earmarked for development or other projects.

Of course, the crisis taught them to thrift and neatness, but the mentality has not changed. There will be no Ukrainian builders, unlike their Western colleagues to work up to 3% per annum. He and the crisis 15% small. It is because of excessive appetite of developers and their irresponsibility of many houses has not yet been completed. And the bankers who lend to these objects, do not know what to do with collateral in the unfinished apartments. Financiers have received a good lesson and will not soon agree to lend to the construction industry. And the conclusions of an interdepartmental committee, whatever they were unlikely to convince them otherwise.
Content tags: Housing construction
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