Experts predict a significant increase in the cost of new buildings in Ukraine in 2025. According to specialists, prices may rise by 20-25%, driven by several important economic and market factors. Let’s find out what influences this trend and how it will affect real estate buyers.
Causes of Housing Price Increase: Key Factors
The rise in real estate market prices is not random. It is influenced by a number of objective economic processes, including:
- Inflation and devaluation of the hryvnia. High inflation levels in the country increase the cost of goods and services, affecting construction materials and labor. The devaluation of the national currency complicates the import of materials, which represents a significant portion of construction costs.
- Fluctuations in the exchange rate. Many construction companies use imported materials that are dependent on the dollar or euro exchange rate. Changes in the hryvnia exchange rate lead to an increase in the cost of such materials, directly impacting the final housing price.
- Construction cost. Increases in material prices, transportation, and labor costs also raise the cost of construction projects. According to Marianna Bigunets, sales director at Gazda company, the rise in real estate prices is “planned” and dictated by the increase in the cost of essential construction components.
Additional Costs: Hidden Factors Influencing the Price
In addition to the primary economic reasons, there are also additional costs that often go unnoticed by buyers. These include:
- Connection costs to engineering networks. Developers often incur expenses for connecting properties to electrical grids, water supply, sewerage, gas supply, and other infrastructural services, which adds to the final price.
- Investments in territory improvement. The number of projects with additional amenities for residents is increasing: children’s playgrounds, sports zones, greening of the territory, and so on. All these investments also affect the value of housing.
- Costs for permits. The process of obtaining permits and other documents for developers is becoming more expensive, which affects the final prices for buyers.
Demand for housing: how increasing interest raises prices
Increased demand for real estate, especially in the western regions of Ukraine, is one of the main factors driving price growth. Over the past year, the highest price increases were recorded in Lviv, and according to Oksana Ostapchuk, a real estate expert, this trend will continue in 2025 as well.
This is due to a high demand for housing among the population seeking reliable investments in the conditions of an unstable economy. According to experts, suburbs of major cities, including Kyiv, Lviv, and Odesa, are also becoming attractive to buyers looking for housing in environmentally clean areas with developed infrastructure.
Price dynamics using a two-bedroom apartment as an example
To evaluate how prices will rise, you can consider the example of a two-bedroom comfort-class apartment in Uzhhorod. In 2024, at the initial stages of construction, such an apartment cost around 2-2.5 million hryvnias. It is expected that during 2025, its value will increase by 500-600 thousand hryvnias, reaching approximately 2.8 million hryvnias.
This is explained by the fact that the final stages of construction are always accompanied by a cost increase due to the need to connect to engineering networks and completion of landscaping work.
Real estate as an investment protection
In conditions of inflation and instability, investors are increasingly considering real estate as a reliable way to preserve capital. Realtor Oleksandr Boyko notes that buying apartments at the early stages of construction not only allows to preserve capital, but also to increase it. The price per square meter increases as the construction progresses, which is a significant advantage for those investing in real estate.
For end buyers, the increase in property prices means higher costs for purchasing housing. Those planning to invest in real estate should take into account that prices in 2025 are likely to continue to rise by 20-25%. Purchasing an apartment at the early stages of construction can be a profitable decision for those who want to save money and get more from their investment in the long term.
