Ukraine Property Market Offers Low-Cost, High-End Condos

Inside The Ukraine Property Market—Own For US$15,000, Rent For US$180 Per Month

Vicki and I are in our third week in Kyiv (Kiev), Ukraine, getting to know the place.

The other day I thought I spotted a billboard offering apartments for US$15,000. Could condos be that cheap? Neither the language nor alphabet made any sense to me, I worked only with numbers. For all I knew that could be a down payment, rather than the full price.

I checked apartment prices with locals who speak English, arranged translations, and searched the Internet.

I was right. As it turns out, new construction costs less than US$400 a square meter outside the center city. So a 40-square-meter, one-bedroom apartment would sell for US$15,000.

I’m told you might get only a shell for that, without flooring or finished walls. You might need to spend another US$400 a square meter or more to put in flooring, kitchen, bathroom, and finishing. Call it US$1,000 a square meter total, or US$40,000.

The Numbeo website figures apartments outside of Kyiv’s center city, probably around where Vicki and I stay, cost US$891 a square meter. A one-bedroom apartment at that price would come to about US$36,000.

Two new luxury-apartment towers under construction nearby sell apartments for US$1,200 to US$1,500 a square meter, call it US$60,000 total for a one-bedroom, 40-square-meter apartment. These high-end condos offer spectacular river views and many amenities. I expect the finished condos will include more than just empty shells.

Great prices. You can buy a condo here in a major European capital at a fraction of what you’d pay in other European cities.

Unfortunately, I’d have to recommend against doing it at the moment. I see problems in the legal framework, war with Russia in the east, and weak government.

Ukraine today is a separate country. But the Soviets ran Ukraine for seven decades, until the 1990s. The Soviet Union did away with due process, private property, legal protections, and independent judges.

Ukraine separated from the Soviet Union on Aug. 24, 1991, and achieved more complete independence from Russia two years ago. So sure, a new constitution may guarantee freedom, property rights, rule of law, yada yada. But institutional support has yet to catch up.

Without due process and rule of law, your title can amount to a worthless piece of paper rather than your dream apartment. You could lose everything and even wind up in jail, if you somehow cross a power player. You’d be crushed, without recourse.

Besides a weak legal system, the war with Russia in the east and an unstable government can create havoc. As I write this piece, Ukraine’s parliament wrestles with how to form a new coalition.

If you’re still interested in buying a condo here, in spite of these problems, at least make sure you come over with a savvy friend who speaks Russian.

Renting might be an attractive way to go. Rents average US$211 a month, according to Numbeo. The Expatistan site comes up with about the same number, and a local in our pub says he pays US$180. At these low rentals, you could get an apartment and use it only part of the year. Ukraine allows Western tourists visa-free entry for up to 90 days out of every 180, same as in Western Europe.

By contrast with these low real estate prices just outside of town, an executive apartment in center city costs a bundle. I saw an ad for a two-bedroom luxury place, furnished, in city-center’s most shi-shi neighborhood, for a whopping US$9,000 a month rent. Perhaps a severe shortage of high-quality executive apartments jacks up the prices.

If you stay out of town you’ll need to take the subway four or five stops to the center. The subway system makes for quite a story.

The Soviets designed the subway in the cold war during the 1950s. Khrushchev insisted the subway serve as a bomb shelter in case of a nuclear attack.

So designers put the system deep underground, more than 100 meters down in the main stations. Coming up the escalators takes minutes rather than a few seconds. Every day commuters waste thousands of man-hours riding long escalators.

I was a boy in the 1950s, and I remember being terrified of Khrushchev. I can still see him pounding his shoe on the table at the U.N. The Soviet Union was going to nuke us willy-nilly. In retrospect, what Ike called the military-industrial complex was engaging in fearmongering to suit its own ends. But the propaganda worked.

Now I learn that Khrushchev built deep subway bomb shelters to protect against a nuclear attack. I figure he was even more afraid of us than we were of him. I doubt many Americans back then were aware of the genuine Soviet fear.

These days Kyiv’s center city offers stunning churches and spectacular museums.

Before coming to Kyiv, Vicki and I knew almost nothing about Russian or Ukrainian painters. We’re far more used to Delacroix, David, and Degas. But these Russian guys knew what they were doing. Paintings of street scenes, portraits, parties, rivers, landscapes, and more make daily life in the old days come alive. Orthodox religious icons in churches and museums show painting techniques that differ so much from Western art.

When we’re in center city, Vicki and I like to eat at cafeterias, where we can point. Restaurants sometimes have English menus; at other times we need Google Translate or a bilingual waiter to help. We’re challenged, too, by the reliance on weights. Meat, fish, and some other items sell by the gram, rather than the fixed price we’re used to. Even when we see a fixed price, the price per gram gets highlighted, too.

Confusing. Vicki ordered grilled salmon for 130 hryvnias (about US$5), and the price came out to be nearly three times that. The US$5 referred to the cost per 100 grams.

Weights can help at times. Pizzas sell by weight, so we can tell whether we’re getting a thick or thin crust by checking the weight.

Coffee and cappuccino come in different weights, too, say 250 grams or 350 grams for small or large.

Ukrainians make wonderful chocolates and pastries. Ukraine’s president owns Roshen, a huge chocolate purveyor. We see Roshen stores everywhere and Roshen chocolate bars in supermarkets. Pastries tend toward strudel, pie, cheesecake, and turnovers that I associate with northern Europe.

Beer taps pop up everywhere. Nearly every stall in the food court in the local mall has two or three draft beers on offer. A Czech-style lager named Chernihivkse—Vicki and I call it Chernie’s—has become my favorite. According to a couple of websites I looked at, a tangy and delicious Chernie’s costs less than beer anywhere else in Europe, a pulled pint for 75 cents or so.

Paul Terhorst

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