We do provide legal advice and support during the following operations with land and real estate in Ukraine:
- general counseling on real estate and construction regulations in Ukraine;
- legal advice during property purchase and sell;
- legal assistance during lease and property management operations;
- legal accompaniment of real estate investment projects;
- legal advice during construction and technical connection to utilities;
- legal support during the commissioning process for the building;
- real estate tax consulting;
- dispute resolution.
How to buy real estate in Ukraine?
First of all, we want to inform you that foreign citizens and companies can acquire all types of immovables, except agriculture land. After you have found an apartment or a house that is suitable for you, it is recommended to check it or to make legal due diligence for such a property to make sure that everything is fine. All needed property or construction documents shall be available and precise. If you do intend to buy an apartment in a new house, the construction company and main legal building documentation are to be checked. Also if you are acquiring an apartment in a new house, you need to check land ownership documents. Real estate legislation in Ukraine is not always clear and transparent.
Consider also that some bad developers do make the construction of apartment buildings with no documents for land at all. Investment in such constructions is absolutely not recommended as the following commissioning of construction in legally impossible. It is sad but in Kyiv, you can find at least a dozen such houses.
If the documents are proper, the next step is an agreement with a construction company (if the property is a new one) or with the owner. An agreement with a property development company can be of two kinds:
- if the apartment or a house is under construction, probably investment contract is to be signed; in such a contract is mentioned the amount of investment and terms of payment, property data (like apartment number, dimensions), the term of building commissioning, and others;
- if the building is already constructed, the property purchase contract shall be signed;
If you will buy apartment in Ukraine or other property from a construction company you will not have to pay any taxes for acquisition. All the state fees, duties, and value-added tax must already be included in the price. Another very important thing is money transfer. You will have to open a bank account and to make a SWIFT transfer to Ukraine. Consider also that in Ukraine only national Ukrainian currency money transfer is possible. So it is needed to exchange foreign currency to UAH. Anyway, if you are buying an apartment in a house that is being constructed, you have to check all the construction documents and permissions. There are a lot of high-rise buildings in Kyiv that can not pass the commissioning process. That means that people that have made an investment in construction can not obtain documents for ownership. Some residential buildings are constructed but empty due to juridical problems. Anyway, if you are buying an apartment in a house that is being developed, you have to check all the construction documents and permissions. Also very important to be sure that land ownership documents are proper.
It is also possible to acquire property in Ukraine by Ukrainian company that belongs to you. It can be a solution also because investment in share capital is free from tax. If you have decided to proceed in this way, you will need a company registration in Ukraine.
To acquire secondary real estate property, you will have to go to the notary. As was mentioned, before you will start the transaction all the documents must be checked.
The document or the certificate for the ownership in Ukraine is called an extract from the register of real estate owners.
What are the property taxes in Ukraine?
Ukraine is almost the real estate property tax paradise. But that does not mean that we do not have real estate taxes at all. First of all, you need to know is that property taxes in Ukraine are calculated from the dimension of the property but not from the evaluated cost. Homeowners are obliged to pay property tax one time per year in Ukraine only if the total area exceeds a certain level.
There are two types of the same property tax (this information is exact as of 2020):
|Tax||0||57 UAH per one square meter|
|Apartment||0-60 square meters||61 square meters and more|
|House||0-120 square meters||121 square meters and more|
Regarding the chart above, consider that if you do own a house with a total area of 200 square meters, you will have to pay taxes only for 80 square meters. The bad thing that local governments can input additional property taxes.
Real estate and construction background in Ukraine
Real estate has always been one of the bases of the economy. And one of the best businesses to invest in. In Ukraine, it is a fast-growing sector. But lately, construction is growing especially fast. There are few key reasons for that:
- Deregulation of the process of permissions obtaining for construction. For the past 4 years, the Ukrainian government made a real revolution in construction approval. Now Ukraine is ranked 35 in the World bank index of dealing with construction permits. When instantly it comes much easier to make some process, it will always make a property cheaper and demand higher.
- Loans. Now it is easier and cheaper to get a mortgage from a bank. Deposit rates have been falling down for the past 2 years, taking down credit rates. Today banks do have more money and are ready to offer cheaper loans on better conditions.
- Economy growth. The economy of Ukraine is has been growing since the 4-th quarter of 2015. Now people have more and more money to spend. Investment, manufacturing, and trading in Ukraine are boosting as well.
- Cheap cost of life and immigration. Many foreigners are buying a property in Ukraine with the aim to live in this country. For most of the people that have never been here, it seems strange. But Ukraine is a very safe, calm, and cheap country. It is really good to live here. Previously foreign citizens were afraid to buy property in our country and even to visit. But now things are different.
From another side, the past few years was not the best time to invest in Ukraine’s real estate property (see globalpropertyguide overview) because of falling prices. But in 2018 prices started to increase because of reasons that are mentioned above.
Although there are some risks for property rights, due to not perfect legalization. But such problems you can find in any country. That is why property acquisition transactions shall be conducted with a qualified solicitors.