Law on the sale of land: what will change for developers and home buyers
Free sale of land carries certain risks.
The Verkhovna Rada is preparing to adopt the Law “On the Land Market” in the second reading. In Ukraine, it will be possible to buy and sell agricultural land. The law will affect the real estate market.
How to change the construction market after the lifting of the moratorium on the sale of land, learned the portal “Capital real estate” 100realty.ua.
New opportunities for developers
Ukrainian developers, especially during the construction of housing in the suburbs, often bought agricultural land and changed it to “building a house”. Thus, they managed to “circumvent” the moratorium.
With the adoption of the law, the process of selling land for development will be easier.
“The opening of the land market may allow large Kiev developers to expand the“ geography ”of their activities and go beyond the borders of Kiev. In fact, land, as a commodity, will allow companies to actively develop the territories included in the Kiev agglomeration. First of all, this applies to improving the quality of housing and the development of related infrastructure. For the implementation of their projects, Kiev developers are attracting land users or renting land themselves, but in very rare cases they are ready to purchase them. After all, the houses built are transferred to the balance of the city, and the construction on the acquired plot automatically increases the cost of construction by an average of 20%, ”says Angelika Sahakyan, marketing director of the multi-functional residential complex“ Polaris Home & Plaza ”.
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In her opinion, now in conditions of limited demand, few are willing to decide on such a step. Developers are more focused on solving existing problems and are waiting for the continuation of the initiated reforms: approval of Geplan and the opening of the State Geocadastre, adoption of a number of regulatory documents on investor protection, etc.
“But I do not exclude that the opening of the land market is quite likely to entail the departure of some companies from the Kiev market. Of course, in Kiev housing is 25-30% more expensive than, say, in the nearest suburb of the capital. But these are new opportunities that will allow us to implement the most ambitious projects, ”she says.
At the same time, with the opening of the market, the schemes according to which they received land for construction illegally or semi-illegally should disappear.
“The opening of the land market can eliminate all existing schemes by which they managed to build on new plots not intended for residential construction, and paralyzes the operation of shadow rolling schemes with land allotment for development. The gray scheme according to which agricultural land is allocated for development, changing the purpose, is nothing more than a vivid example of the paralyzed system of the GACI and a direct signal that it is necessary to begin the reform of the State Land Cadastre. According to this scheme, construction was usually carried out in the suburbs of Kiev, negotiating with the local authorities through kickbacks, ”said Viktoria Bereshchak, an expert on the real estate market.
Opening a land market will reduce corruption risks
Obtaining land for construction is always a difficult process for developers, which ultimately affects the price per square meter of housing built.
“For developers, the discovery of land is the destruction of yet another corruption component that impedes their activities. When the land is owned by the developer, it practically does not depend on the local government, which previously managed the land resources of a particular locality. Of course, many developers who sell apartment buildings are used to renting land, because the ZhK built by them, after they are put into operation, become on the balance of the settlement, ”says Tatyana Shulga-Zabelskaya, managing partner of the RED Community.
Thus, if the corruption component decreases, they will build more actively.
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Development land will rise in price
The opening of the land market will increase the price of hundreds. Demand will be quite high.
“There is and will be a demand for land that is in close proximity, let’s say, in a junction with major cities and major transport hubs, for example, to the Borispol airport. Land plots located along the highways leading to the transport hubs will also be attractive. In addition, you should not discount land located within the boundaries of satellite cities. When opening the land market, it can be assumed that the value of such land plots when changing their purpose, will increase. Now they say that before the opening of the land market for foreigners, the average price per 1 ha will not exceed 2-3 thousand dollars. I want to remind you that today, for example, in satellite cities