Introduction

Many of the new rules related to the coming into force of the Civil Code of Ukraine as of 1 January 2004 are considered positive and create fair and favourable conditions for the development of real estate market in Ukraine.

Foreign citizens or legal entities have the right to buy and own property in Ukraine. These property rights are set forth in the Constitution of Ukraine and Law of Ukraine On Property. The law permits owners of property (including foreign investors and joint ventures) not only to own property but also use such property for commercial purposes, lease property, and keep the revenues, profits, and production derived from its use, after all necessary taxes are payed.

Corruption, lack of regulations, lack of controls and lack of respect for an individual's rights as well as an insecure legal framework for enforcing personal property rights means that buying property in Ukraine is most certainly not without potential headaches, stresses and problems. So, finding a well-connected real-estate agency is essential, as it is impossible to check the legal status of an apartment without an agency.

The New Ukrainians

There is Russian proverb "any silly wish for your money" and as long as you are paying, construction companies and architects will fulfill whatever fantasy without considering any building codes or engineering standards.

Many newly well-to-do Ukrainians (so-called New Ukrainians) buy apartments and buildings in the historical districts and restore them, without first consulting an architect. As a result, buildings throughout the city have collapsed or cracked while attempting to transform them into "elite" residential estates. New Ukrainians have a set mind of grandeur. For the New Ukrainians it is fashionable to have a ten step entrance; it is cool to have an elevator (which of course requires at minimum a three or four story apartment) and it is essential to have a spiral staircase leading up to a tower structure with a bell in it.

There is also a widespread trend amongst New Ukrainians to build an "architectural masterpiece" in the marshy flood plains of the Dnipro River. On a comical note, the so-called "big chair" officials joke that they don't have to impose building regulations on these mansions because nature will do this for them.

Conclusion

Buying a home in Kiev is still very affordable, but because of the unknowns associated with Ukraine, you must take into consideration the following or your plans.

First, do not try to go after miracles and follow the sober mind. Research the area, because you don't want to end up on a flood plan in Podil or old cemetery or next to a major electricity line. The process of finding an apartment was a headache as there was a certain body of apartments that for various reasons are on the market and stay on the market. Either the agent is incompetent and has the sole license to sell that apartment, or there is something wrong with the apartment that they don't tell you. So going through the ads it looked like we were going through a list of apartments that were not any good and this is because these are the ones that simply stay on the market, and the good ones come on to the market and are sold fairly quickly.

Don't do things on your own, go through an agent and have a good lawyer. Be careful, take it slow, make sure you have someone who speaks the language and has your interests at heart, and then make sure they know a lawyer who is in the business. It is worth paying the fee for a good lawyer because there are constantly pitfalls that could cost you a lot of money and time.

Finally, buying a home in Kiev is more difficult than in the EU or in the States because there are more pointless regulations and paperwork, and you really need assistance of someone competent to guide you through them.

Taxes: There is a 3% Ukrainian pension fund tax that foreigners are not required to pay when buying their first apartment. However, if you plan to buy a second apartment, then this 3% tax applies.