In conditions of expensive borrowing and a lack of their own funds developers have to postpone the realization of new house projects for an indefinite term, and a shortage of ready business and prime class houses is emerging on the market, the business development director at Knight Frank Kyiv, Yaroslava Chapko, has said.
According to a survey of the country real estate market of Kyiv for the third quarter of 2012 drawn up by Knight Frank Kyiv, as of September 2012, houses in 73 housing estates were available for purchase, and the share of economy class houses is over 65% of total supply, while the share of the prime segment is only 5%.
The survey says that houses built and land plots with work contracts are on offer in almost half of all housing estates, and the number of houses and land plots without work contracts is growing.
In the third quarter of 2012, Odesa, Zhytomyr and Obukhiv directions are leaders on the primary out-of-town real estate market with the share of some 70% of housing estates with sales in progress. The distribution of elite projects among directions is stable, and the main volume is focused in Obukhiv direction.
The company said that in the third quarter three new housing estates with a total number of 100 plots entered the country real estate market of Kyiv: Sosnovy Hai, Sviatopole and Schaslyve Zhyttia.
New sales on the market in the third quarter were mainly sales of houses for permanent living located 10-15 kilometers from Kyiv, while in remoter housing estates (over 25 kilometers) houses were bought mainly for seasonal holidays.
“Despite the market stabilization and even a small rise in the price of houses in H1, 2012, a slight fall in the business and economy segments was seen due to expansion of supply and the fall in the prices in the most projects that have sold on the market for a long period of time,” reads the survey.
According to the company’s experts, in the fourth quarter of 2012 most developers will actively offer various installments and discounts to stimulate sales, which will cause a fall in the average price of the supply in the country real estate segment.
Knight Frank was founded in London and provides a full range of agent and consulting services for developers, real estate owners and users, including businesses and individuals. At present, Knight Frank has over 243 offices in 43 countries, and employs over 7,000 specialists.