From An Ugly Duckling To A Beautiful Swan: The Ukrainian Capital Real Estate Market
The potential inherent in the Ukrainian capital has made it one of the hottest destinations for real estate investments in Europe in recent years. DGY Investments, which deals with real estate investments and property management in Kyiv, can make any property investment dream a reality.
Those who wishto invest in real estate abroad should take a closer look at Kyiv – the capital of Ukraine, which offers everything an ordinary investor is looking for – cheap living, restaurants, tourism, development and commercial centers, glamorous nightlife and suitable living spaces for families and young couples. If all this abundance is not enough, Kyiv offers a variety of options to invest in profitable real estate with a twist. In recent years, the real estate metamorphosis and the number of construction projects in the city have been sky rocketing. This allows investors with limited capital to generate significantly higher profits than with similar investment productsin other countries.
However, before we get into the numbers, let’s discuss the elephant in the room. Ukraine is still perceived as a third world country and investors are notin a hurry totake a financial risk. So what has changed? It turns out that quite a bit. A few years ago, the Ukrainian government has made it its motto to fight corruption and economic crime, and today the results are there to be seen for investors and citizens alike. The U.S. administration has also mobilized for the cause and transferred hundreds of millions of dollars to Ukraine as a military aid, along with imposing sanctions on entities identified with corruption in the country.
Daniel Schapiro, one of the founders of DGY Investments, is an Israeli-American businessman who lives in Kyiv. In response to our question, “What is so special about investing in real estate in Kyiv?” he replies: “It’s very simple – a small investment, a new residential apartment, a highly sought after location and a high annual return. After quite a bit of homework, we’ve come to the conclusion that there is a very profitable niche suitable for relatively small investors. Investing in residential apartments in attractive areas of the city requires a low investment with a relatively high ROI compared to other countries. For example, if you purchase an apartment in the center of Kyiv fora sum between $60,000 and $120,000, you can geta rent ranging from $750 to $1500 each month. In other words, a return on an investment that can reach 15% per year, which is a fantastic return for a real estate investment, and for relatively small amounts.”
According to Daniel, “If you want to sell the property, that’s also great. With the right investment in the early stages of aconstruction project, the property value can reach 30% from the date of the purchase agreement until the key is handed over to the investor. In addition, there are no indirect taxes at all. At the time of purchase you pay 1,5% tax to the state, and in a quick sale process you pay 18% tax on the profit only. The icing on the cake is that if 3 years have passed since the date of purchase, there is no tax at all.”
Bud Slavutych, DGY marketing project
DGY Investments is managed by two additional real estate experts. Yehuda Levison has been Daniel’s partner for many years. He is a British businessman with extensive experience in managing profitable investments, and he also lives in Kyiv. Yehuda serves as the company’s CFO and is responsible for many of the discounts and benefits that DGY clients receive. Gil Attia is the third partner, who serves as the company’s CEO, and has extensive experience in the real estate markets in the countries where DGY operates.
“I just want to make something clear,” says Daniel, “we strongly believe in each of the projects managed by the company. This is why Yehuda and I invested in each of them personally.” After identifying the niche and gaining considerable personal experience in a large number of investment transactions, DGY Investments was established to provide a supportive platform to investors who can’t or won’t engage in all aspects related to investing.
Bud Symbol, DGY marketing project
As of 2021, DGY Investments employs a team of over 250 people who are entrusted with the management of some 1,700 residential apartments in 22 projects. According to Daniel, “The big leapin real estate investment in the city occurred last year when Kyiv flourished in comparison to other cities in the world that were dealing with the corona outbreak. Anyone who visits the city can observe a tremendous building boom and a massive development of new areas, as well as many businessmen and high-tech companies that enjoy all that Kyiv has to offer. During the corona year, the real estate business really flourished in Kyiv, all the businesses continue to function, no unnecessary closures were imposed and the rent continues to flow as usual.
“So what’s the secret?” We asked and Daniel replied, “In Kyiv, we focused on the city center where innovative projects are set up very close to shopping centers and playgrounds and are situated within minutes walking distance from the subway. We choose only projects managed by developers and contractors with a proven reputation and record. We are here to remove obstacles and ease investors’ concerns, especially of those who can’t or won’t come to Ukraine, and study the local market, regulations, and procedures for buying, selling, and renting properties. We possess all the necessary knowledge, all the solutions, and direct access to the best professionals, in order to provide our investors with maximum control over their money, investments, and assets. If the investor wants to renovate the property, rent it out or anything else, DGY will take care of everything needed, so that the rent will keep coming every month, as if the investor lives in Kyiv.”
According to Daniel, all DGY services are based on one key principle, “To avoid unpleasant situations, DGY does not hold or control the client’s money and the client can terminate the contract at any stage without infringing on property rights.”
In order to invest in Kyiv, the investor must register in the country and open a local bank account. During the first stage, DGY takes care of everything required for the registration and opening of the account. After that, the investor gets access to a variety of properties, out of which the most suitable asset is selected. DGY provides full support to the investor in whatever is required until a sales agreement is signed and the rights to the property are transferred. In case the investor is interested in renovating the property, DGY offers a variety of renovation options according to the chosen budget, including recommendations on how to properly divide the property, the appropriate proportions, and raw materials at the most affordable prices.
Daniel Schapiro, Gil Attia, Yehuda Levison
To propel the process, the investor needs to deposit a total of $750 in the company, which in turn will open a client account, conduct a feasibility study and answer questions. The fees for the various service are paid as the client progresses in the investment stages. According to Gil Attia, “DGY clients enjoy all the benefits and discounts that the company gets when it buys dozens of properties in each project. This fact is explicitly stated in the agreement between the company and the investor. We monitor areas of demand, along with performing comprehensive and in-depth background checks on each project. We ourselves invest in the same properties as our clients, as well as choose the most promising contractors, present all the options to the investor and handle all the documents and bureaucracy vis-à-vis the state and the service providers. We are in the field on a regular basis, “giving hell” to the contractors, as there is no substitute for the peace of mind of our clients.
WhiteLines, DGY marketing project
“We take the concern of investing abroad very seriously,” Daniel concludes, “This is exactly why transparency is our key value and guiding principle. Our investors also get an additional bonus – since we work with many reputable law offices and accounting firms, our clients are welcome to contact them directly with any question at any time. We do and will do everything necessary so that our clients not only know but also feel that they are in the best and safest hands while enjoying passive income and peace of mind.”
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More about DGY
DGY is a real estate investment and property management company. Our experts have an impressive experience in turning businessmen into smart real estate investors. We collect limitless opportunities throughout the world’s best real estate markets and help our clients implement the best deals. We take care of all due diligence and customize documentation while your income grows. We also provide you with property management services so you can forget about the tiresome maintenance of several objects and entrust this process to professionals.
Investment advice and recommendations
DGY is an investment company that takes care of every client and helps them become successful investors. With the help of an investment experience and a well-thought plan, we will help you examine the market, choose a strategy specifically for you or your business, and calculate future costs to start making money with real estate investment.
In order to invest in real estate, you should consider how you will run your management in Ukraine. DGY will help you eliminate all possible pitfalls at an early stage as a personal project manager will be assigned to your case. They will assist you in choosing the project according to all required objectives.
DGY Investments takes care not only of purchasing property but also renovating an existing one. With the help of a thorough plan and estimating, we will thoroughly prepare a property for sale. Our professionals evaluate an investment property and create a strategy that includes the costs for renovation, possible taxes, fluctuations on the market, etc. Therefore, our clients are able to resell the renovated properties in Ukraine with more than 15-20% profit from the initial price.
Before our clients decide to deal with real estate investing, they consult with our experts concerning details such as the necessary documents needed to purchase a property and successfully run all the processes connected to it.
Therefore, if you are eager to invest in Ukraine, it’s essential to have all the paperwork done correctly, and that’s the moment when our team of experts takes care of this step. DGY Investments helps investors buy real estate property, manage the paperwork, start preparing relevant documents for purchasing realty in Ukraine, and close the deal successfully.
Real estate investment opportunities in Ukraine
When an investor decides to invest in real estate in Ukraine, the most affordable way to attain stable passive income is through buying residential real estate. Investors can expect to receive a regular monthly payment from their tenants at a fixed monthly amount, unaffected by inflation or other unforeseen circumstances. The amount of rental income will vary depending on the size, type of property and location. For example, buying an apartment in Ukraine’s capital Kyiv is beneficial to investors due to offering a large working population, central location and affordable prices. Hence, the minimum price of renting a decent one-bedroom apartment in Shevchenkivskyi District will be around $1000 per month in 2021, followed by Pecherskyi District with a cost of $850 per month. Besides, investing in real estate in Ukraine annually brings clever investors up to 15% of yield, attracting many business people every year.
Properties for investments in Ukraine
Ukraine has a giant sector for real estate investing. Businessmen who come there all over the world often choose between investing in residential and commercial properties. The main advantage of buying property in Ukraine is the affordability of prices on the houses and apartments. For instance, if you invest in real estate in a historical district, a luxurious apartment will cost you around $85k only.
How to invest in Ukrainian Real Estate
In order to invest in Ukrainian real estate, you should take into account a list of crucial factors. The first one is to choose what kind of realty you are going to invest in: residential or commercial. It is vital as it should comply with Ukrainian real estate law. The second tip is to identify the purpose of purchase in order to make a strategy for the property. For instance, you may purchase the property for your own use or buy it for lease. The next step is to calculate the taxes and what kinds of taxes are payable during the purchase, owning, or selling. Also, to invest in real estate properly, you should keep in mind currency control rules in Ukraine to sell a property and get a higher profit.