Housing for displaced people: Kyiv intends to buy 1,000 apartments, but they will not be enough for everyone
Why the 2 billion UAH allocated by the city will not solve the problem
The municipal entity, Zhytlo-Invest Financial Company, received 2 billion UAH from the Kyiv City Council. The money will be used for the purchase of 1,000 apartments that will be rented out to displaced people.
At the same time, as Mind found out, the approved programme does not exist yet. Moreover, according to the interviewed experts, even 1,000 apartments will not be enough for everyone, and the very process of housing distribution risks being non-transparent.
How the city proposes to solve the problem of displaced persons
There were about 70,000 internally displaced people in the capital, the city council estimated in June. There haven't been more recent estimates yet.
These are Ukrainians who came from the eastern and southern regions: from Kharkiv, Mykolaiv, settlements of the Donetsk Oblast, and even Odesa. According to Dmytro Korchev, director of Brok-Realty real estate agency, such people are attracted by the opportunity to find a job and rent housing in Kyiv for 7,000-8,000 UAH per month, which is cheaper than in the western regions.
The city offered to house the displaced people in rented apartments. The Kyiv City Council has already increased the statutory fund of Zhytlo-Invest municipal enterprise by 2 billion UAH, which will be used for the purchase of housing. According to Vyacheslav Nepop, Deputy Head of the Kyiv City State Administration, who used to head Zhytlo-invest for a long time, about 1,000 apartments are planned to be purchased.
“The city has made a decision to purchase housing at the expense of the city budget, which will be the property of the territorial community. The issue of providing housing for citizens and IDPs can be solved thanks to the rental of this housing. It can be both a long-term lease and a lease with the right of buyout,” the press service of the Kyiv City Administration quotes Mr. Nepop as saying.
No additional details on how the programme will be implemented have been provided yet.
At the request of Mind, the press service of the Department of Construction and Housing reported that a corresponding housing distribution programme was still being developed.
Mr. Nepop adds that when housing is allocated, priority will be given to:
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families of participants of military operations in Ukraine;
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persons who lost their homes in the temporarily occupied territories;
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Kyiv residents who want to improve their living conditions.
“This will become an alternative for citizens who do not have the financial ability to purchase housing. Especially today, when banks do not lend to the real estate development in the primary housing market,” Mr. Nepop states.
What officials are silent about
There are really a bunch of questions on the programme, which is supposed to solve the problem of displaced people, admits Rostyslav Kravets, senior partner of the Kravets and Partners law firm. “There are no housing requirements, the programme itself is not presented either. But it is absolutely clear that such apartments should be renovated and furnished to be rented,” he points out.
The lack of rent calculation mechanisms is also confusing. If the city plans to buy 1,000 apartments for 2 billion UAH, then the average price of one apartment will be $50,000. For that kind of money, it is nearly impossible to buy an apartment in Kyiv, unless it is a single-room one.
One of the most difficult issues is to determine who needs a municipal apartment more, says Angelina Derevliova, director of marketing and sales in the Miskzhytlobud (City Residential Building) company (River Stone Residential Community). “Are these people who have lost their jobs and homes, or the ones who have large families?” she clarifies and adds that Ukraine already had experience of queues for apartments, for instance, among security forces, and some of them received housing earlier than others.
1,000 apartments will not solve the problems of the displaced people, who need many times more real estate.
Angelina Derevliova believes that a programme of partial compensation for the cost of renting apartments would be much more effective. “Or the city could pay utility services instead of them. All this would reduce the financial burden on families,” says the expert.
The city should not collect funds for renting apartments from internally displaced persons, believes managing partner of consulting company SV Development Serhiy Stepenko. “It is better to provide such apartments for free for 3-4 months to give people the opportunity to find work and rent housing,” he adds. Rostyslav Kravets assumes that with the help of this programme, the city probably wants to support developers and buy apartments from them.
We reiterate, that after the beginning of the war, housing sales have stopped, and 20-25% of buyers have not paid installments according to previously concluded contracts for the purchase of property.
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