How to distinguish a pearl in deserted and not expensive piece of land?

Prices for land in Ukraine do not grow but gallop. Native land is almost as foreign by cost.

Buildings and accommodations brings to their owners from 10 to 30% annual if they are for rent. On reselling the plots you could earn in several times more. Growth prices on land near Kiev for the last 2 years were 86-650% it depends on direction. In Kharkov plots are grow in price as minimum on 100% per year, brokers do not predict slowing down the tempos of growth and in next year. In Donetsk only for three summer months the cost of plots grew on 10-15%.

That is why, land is still the most attractive object for investments. Buying a plot you could forget about it for several years. Then resale in two times expensive. Plots are the good way of investing money.

In regions the land market was weak developed and plots almost did not resell. The situation changed 1-2 years ago. Prices grew sharply even for those plots which for the last time were not liquid.

There is also not perspective land $300-500 per 0,024 acres, which nobody wants to buy. A lot of plots are selling by the price in 2-3 times lower than market price, but nobody buys is anyway – they have bad location, far away from the road and other utilities. So, the most profitable strategy of speculator takes liquid plots by average price.

How to search.

Wise investor should see a pearl in cheap piece of land. Estimate, if prices for the plot grow in several years. What signs of future growth could be? Announcement of authorities about constructing a road near by, talking about electrification of the district, laying of heat pipeline and etc. There is one more strategy. There are companies in Kiev which buy plots where in a future will be construction of roads. “Could you imagine how much you should pay to authorities to buy out this land? Profit is huge”, - retells broker from Kiev Sergey. Of course this strategy is risky: Ukraine is not the USA; that is why authorities with private property of citizens make no bones. There is a risk that this land will be taken as “social important”. According to the law local authorities could take land for social needs. They should buy out it from the owner or give equal by cost plot as compensation. If owner and local authorities will not come to agreement then the problem could be regulated by court. Here always starts the interesting thing: it is unknown on what side will be court. It is a huge possibility that on the side of the client – especially if his interest will protect good lowers. Legal services in this case will be expensive: land questions in case of working with physical person are the most profitable. The cost of services could be $10 thousand, if the case is complicated. Average case is about $2-5 thousand.

There is one more variant. You could buy quite big plot for $100 thousand and divided it on two parts. In 2 years each of these parts will cost $100 thousand: first of all, prices on the market grow, in second, small plots are popular.

Risks.

The main risk while investing in land could be act of God made by authorities’ decision. For example, decision of constructing the garbage range. Cost of near by plots should fell in a moment. But only theoretically. While transfer of factories-ranges is interesting for local authorities and suburban land are on region authorities hands who have money from this land. So, city wants to create enterprise on the land which it does not possess.

According to the General plan of development of Kiev till 2020, authorities are planning to remove or liquidate till 40 enterprises which take more than 247 acres and more than 5 – redesign. Part of they is closed because of insecurity, part is bought out by construction companies and whether it redesign or it is a residential construction on its territory, the rest is planning to move to suburb. However…authorities told that there is no free place in suburb. The majority of land under Kiev is sold by region authorities. That is why the question about where put factories after they will be in suburb, is still open.

In million-plus city the situation of risk is similar, but leaves off 2-3 years. The exception is just suburbs of Donets – just to its line step up big cities (as Makeevka – as good region center). There you should be very careful with investments in suburb area – except Ukrainian risks there is one more: it could be that smack-bang under plot goes deserted driftage. Minefield and that is all.

What cost?

The cost of the land depends not only on location but also from functional assignment. So, the cheapest land is for agriculture, and land for constructing for example, commercial property is a bit expensive. According to the territory principle, so the most expensive land is in a capital region and neat the million-plus cities.

In a region of small and big dams in Konche-Zaspe (elite region of Kiev) 0,024 cre will cost $2-12 thousand. Plot on Petropavlovskom and Sofia Borshagovka costs $ 3-5 thousand per 0,024 acres, in a village Kosin – from $ 1 thousand. Kiev realtors said that prices will grow more. For the moment in Kiev there is a high quest for plots for residential construction and also for plots from 12,35 acres for construction of big trade complexes by foreign realtors, for example, Auchan, Carrefour, IKEA, Practiker and so on. Under Kiev in 12,4 miles area there is a quest for land constructing cottage cities and modern logistic complexes.

Near Donetsk a plot for individual construction will cost $ 5-20 thousand per 0,0224 acres. In a central part of the city 0,024 acre costs $25-30 thousand, on outskirt and suburb - $ 3-5 thousand.

In Odessa works “marine law”, the closer the lot to the sea, the more expensive it. For example, in a region Arkadia, the cost of 0,024 acres on secondary market is till $ 100 thousand, under Odessa and on the outskirt of the city – from % 5 thousand on not seaside and from $10 thousand on seaside. There is a land which cost $2 thousand per 0,024 acres, and there is $100 thousand per 0,024 acres. Cost for plots is equal with accommodation’s cost. One bedroom flat in “Khrushevka” on the suburbs costs $50 thousand. For the last year in conditions of intensive installation of gas, improving transport, development of infrastructure and constructing of trade objects, grew in price land which is far from the city, as director said. Last year the plot in 12,4- 18,6 miles from Odessa cost $4 thousand per 0,024 acres, and now - $6 thousand.

Growth of land cost in the next year will slow down. If before prices grow on 100% annually, than in 2007 will grow on 30%. Why? The market is closed to saturation. All got plots and want to sell it expensive. Buyers in their turn do not hurry; they just do not like the prices.

Over the sea is not more expensive..

Prices for land in Ukraine are not far from foreigner. Cost of 0,024 acres near London is from 3 thousand pounds. The price of plot in 3,1 acre near Britain capital, which was bought for 25 thousand pounds during 15 years will increase to 234 581 pounds in case if there is no permission for construction. If there is such permission and residential object is built, the price could grow to 419 569 pounds. In Russia price for land is also “biting”. Nobody s surprised by “golden” plots with cost $ 100 per 0,024 acres.


What influence on the price of plot:
- target purpose;
- distance to the city;
- perspective and prestige of direction;
- square and relief;
- driveways;
- utilities on the ploy or near it: light, gas, water;
- buildings on the plot;
- natural conditions and picturesque places: closeness of park area, forest, river, lake;
- social surroundings;
- railway