Kyiv (alternatively spelled as Kiev) is the Ukrainian capital. Ukraine is a country, which has drawn much world attention in 2014. In 2021, it offers the best opportunities for real estate investment. It is currently among the world leaders (without buts) in such things as the growth of nominal salaries, IT industry, doing business, procedural transparency, shifting to paperless in all areas of life, stability of its national currency, lowering corruption, and growth of prices of real estate. Although, it is quite possible that the latter is the direct result of all previous. And, without going ‘round in circles, we provide you the Ukraine real estate rental yields in a table view so you can clearly see why Ukraine property is the most alluring financially today.
Rental yields in Europe as of 2021
You, as a seasoned investor, already know that a gross rental yield is an annual rental income in percentage compared to the property purchase rate. In the table below, we consider the same kind of property across 35 countries: 120-square meters (1300 sq. f.) object located in the city center or proximity. This is what apartments in Kyiv Ukraine are mostly like in the city center. Below, we provide the European country’s name and the rental yields as a percentage.
- Ukraine: 9.1%
- Montenegro: 7.5%
- Ireland: 7.1%
- Romania: 5.9%
- Poland: 5.5%
- Portugal: 5.5%
- Croatia: 5.4%
- Lithuania: 5.4%
- Hungary: 5.2%
- Bulgaria: 5.1%
- Macedonia: 5.0%
- Estonia: 4.9%
- Denmark: 4.8%
- Cyprus: 4.7%
- Slovenia: 4.7%
- Belgium: 4.6%
- Slovakia: 4.5%
- Serbia: 4.4%
- Luxembourg: 4.4%
- Latvia: 4.1%
- Spain: 4.0%
- Greece: 4.0%
- Italy: 3.9%
- The Netherlands: 3.7%
- Malta: 3.3%
- Finland: 3.3%
- Andorra: 3.1%
- Czech Republic: 3.1%
- Switzerland: 3.1%
- Norway: 3.1%
- Germany: 3.0%
- France: 2.8%
- The UK: 2.8%
- Austria: 2.2%
- Turkey: 1.9%.
As you can see, an average property in Ukraine does 21% better than its closest competitor.
Kyiv real estate prices
Prices for objects of Kyiv real estate grow both in primary and secondary markets. The booming growth has started in late 2020 and continues until today, to the end of summer 2021. For the past 6 years, the price of 1 square meter of all apartments in Kyiv grew from $1,233 to $1,500 (+22%) on the secondary market; for the primary market, it was from $565 to $1,557 (+175%). As it is clear, the cost of new housing today is comparable to the price of the old one, even as old as 100+ years. You won’t have difficulties in dealing with dollars on the Ukrainian market because nearly all buyers and sellers would like to tie to American Dollars in their deals rather than to Hryvnia (Ukrainian currency) because of traditional distrust of the national currency, financial and banking systems, which continues from the 1900s.
The national market of primary housing (newly built, sold by builders) has over 100,000 new square meters of residential real estate area every year (excluding only a few years of Russian war start. But then trends have restored). Also, as Ukraine significantly faster restores from the COVID-19 consequences than the rest of countries, and people traditionally stock billions of dollars “under their mattresses”, eloping banking system, the market grows by a two-digit percentage beginning with 2020. The biggest growth is shown in Kyiv in the segment of 3-4-5-bedroom apartments: only for the past year, their cost increased by 10%-18%. The segment of 1-2-bedroom apts. shows the growth of +4%… +8% annual 2020/2021. 3-4-5-bedroom apartments are the best suitable for the remake into small hostels, which could accommodate from 1 person to 9-12 persons in one bedroom.
Although it is still possible to buy a 1-bedroom apartment in Kyiv for a price lesser than $40,000, the market embraces only 4% of such objects, while giving 52% of volume in objects with prices between 40 and 75 thousand dollars, and 24% in objects between 75 and 110 thousand. As you can see from the absolute numbers, the cost of housing in Kyiv is still one of the smallest in Europe. So, for a median price of an average family house in the US of $227,000, it is possible to buy from 2 to nearly 6 apartments in Kyiv. By the way, throughout Ukraine, around 42% of citizens live in apartments in many-story houses and 58% live in private homes (mainly, in regions). But in Kyiv, it is impossible to rent a house for a living – nearly 100% of the offers are made of apartments in many-story houses.
Ukraine cost of living
When it comes to the cost of living in Ukraine, according to one of the reliable services of statistics of the cost of living around the globe numbeo.com, it is on average 55.6% cheaper to live in Ukraine than in the US. Rents in Ukraine are around 73% lower than in the US (data across Ukraine vs across the US – on average).
If to take Kyiv specifically and compare it to New York, then it is on average 66.3% cheaper to live in Kyiv than in New York while rent in Kyiv is around 82% cheaper than in New York: it takes $576 to rent a one-bedroom apartment in Kyiv center and $343 outside the center. For a 3-bedroom apt., the numbers are $1,115 and $606.
