Whenever people ask me how the Kyiv real estate market is doing, I typical reply that it really depends on who you are in the market. For sellers, prices in the historical center of the city started to slide down significantly in the second half of 2024, and eventually began to approach the deep crisis numbers of 2019. And this is if you are lucky enough to have a property in the more liquid one and two bedroom segment. There are currently very few potential buyers for larger apartments, as spending three to four hundred thousand dollars or more on property during a major war is too much for most to stomach.
Rental Rates Surpass Prewar Levels
For Kyiv property owners who rent out their apartments, the market looks much more solid, with most rental rates at least back to where they were before 2022. In many cases, rental rates in 2024 have surpassed the prewar level by 10-20%. If you are a renter looking to live in a nice one or two bedroom apartment in the center of Kyiv, you better have a good budget because the competition is fierce and places go very quickly. The tenants who are currently in the best position are those looking for larger places with three to four bedrooms and no special security requirements. Meanwhile, the substantial overall deficit of quality rental housing in downtown Kyiv remains a major factor, regardless of the many quirks related to wartime conditions.
Three Scenarios for 2025
Looking ahead to 2025, I see three possible scenarios for Ukraine that will define the development of the Kyiv real estate market as well as pretty much every other aspect of daily life in the country. The least likely scenario is also the worst case scenario, and would involve a repeat of the initial phase of Russia’s full-scale invasion with Russian troops once again advancing to the outskirts of Kyiv. This would lead to all manner of panic, mass evacuations, and economic collapse. You can imagine for yourselves what that would look like, so I won’t discuss it in further detail here.
The second scenario is more or less the current status quo, with intense but fairly static fighting continuing along the front lines in eastern and southern Ukraine throughout the year. This would likely mean that Kyiv rental rates remain high, to the benefit of the owners of rental units but to the chagrin of tenants. The biggest impact of this scenario would be on sellers, as a protracted war tends to drag the economy down and also prevents many owners from coming back from abroad. Sellers would see sale prices continue to drop slowly, especially if Russian attacks on the Ukrainian energy grid further degrade the country’s ability to reliably provide power and heat.
Property Owners and Peace Prospects
The third scenario is almost wholly dependent on how the incoming Trump administration chooses to approach the war. Outside Ukraine, Trump is widely seen as someone who will sell Ukraine down the river on his first day in office. However, many Ukrainians seem to be taking a more wait-and-see approach toward his presidency. Some are even optimistic that Trump can either end the war on more or less acceptable terms, or perhaps turn the tide with massively increased support.
If the war shows signs of winding down or even comes to an end in 2025, rental prices in the historic center of Kyiv will increase sharply as more foreign specialists arrive in the city and large amounts of new positions open up to address reconstruction, de-mining, EU integration, and the one hundred and one other things that postwar Ukraine will need. The return of Ukrainian and expat families would drive up demand for larger Kyiv apartments and for those properties that don’t meet the heightened wartime security requirements of the current tenant pool. This scenario would be very good for the owners of rental apartments but bad news for any tenants who are already having a hard time finding a decent home.
If a plausible peace settlement appears to be taking shape, I predict that many Kyiv real estate owners who are currently looking to sell their properties will become gripped by a mood of irrational exuberance. This is something I have already seen happen several times over the past 12 years while working in the Kyiv real estate industry. An end to hostilities, which implies an acceptable and long-term peace for Ukraine, would be interpreted by many Kyiv property owners as a signal that the country is now on a fast track to EU and possibly NATO membership. This would encourage them to start asking why Kyiv real estate prices should be any lower than in other major European capitals.
In such a scenario, I can easily imagine some Kyiv property owners doubling or even tripling their prices overnight. They would be joined be many more new sellers who suddenly decide to cash in on Kyiv’s enhanced status. As a result, the real estate market would be flooded with vastly overpriced apartments. But putting something up for sale is not the same as actually selling it, and this surge in prices would likely end in massive disappointment across the board as sellers fail to find buyers. This initial period of excitement would probably take around six months to subside, with prices eventually settling at around 20-30% higher than current rates, which is more or less the same level as during the final months of 2021 on the eve of the invasion.
About the author: Sean Almeida is CEO of Vestor.Estate real estate agency and has been resident in Kyiv since 2012