Would you buy real estate in Ukraine right now?

[justadude]

If you wanted to live in Ukraine for more than 75% of the year, would you buy a place if you had the funds in cash and you could afford to lose all of your investment (although it would suck) if things went to hell? Are you bullish or bearish on the Ukrainian housing market, specifically South Western Ukraine? I wonder what happened to the property owned by foreigners, and locals for that matter, in Donetsk and Lugansk after Russia moved in.

[Halo]

As a foreigner, you will pay a premium price.

Real estate is where the wealthy launder their money.  So, the market is oversaturated.  Furthermore, at this time, because Kolomoisky essentially controls most of the levers of government, Ukraine is heading back to the early 2000's, when foreign based absentee owners would come back to apartments to learn they'd been sold three to ten times in their absence.  There was an Italian race car driver (I think - may have been a football star) who arrived in Kiev with his UW, to find his apartment occupied by its "new" owner.  His wife wanted to just leave the issue, but he refused.  He did get it back, after a five or six year court battle.

[justadude]

I guess that's one vote for bearish

[Guile]

justdude...never buy a home in a foreign country unless you know you're gonna be there for 10+ years.  Just rent. Put your money in American stocks and bonds.

Why take risk when you don't need to.  You don't speak the language and will need real estate agents, lawyers etc to help you.  Another way to get scammed.

I don't know your investment strategy but as a finance guy who manages my own portfolio I would just invest in American stocks/bonds, etfs, indexes. Keep things simple.

[AvHdB]

Let me answer the question, with a question. Would you buy real estate in the United States right now?

[redroo]

Yes, it has been a place to park money, and yes there were troubles in the past with apartments being taken over.
The Odessa market has had many new build apartments over the last 5 years. Quite a bit of it high standard. many new apartments are "bare". You buy the shell and outfit it yourself. This makes it hard to price apartments that may be of vastly different quality in the same block. many blocks that are 5 years old, are fully sold, but only 1/2 apartments are lived in (or finished).
AS the population gets richer and everyone gets a car (usually 2nd hand from Germany) Parking is now a real issue. Parking spots are usually sold extra to the apartment (ie you don't get one unless you pay) so street parking places are scarce.
New Airlines are adding Odessa to their schedules, and Odessa is expected to keep moving forward economically.
I considered buying 5 years ago but decided to rent then, starting to consider it again. The prices certainly haven't fallen in quality blocks out along Fransusky Bldve over that time. Akardya builds seem more cheap and nasty, as built almost solely for holiday rental.

[justadude]

Being used to Northern California prices (not San Francisco by any means, but well above the US average) when I look at RE prices in other areas I get excited sometimes. For example, here is a beach front place on the Black Sea for $330K. I could see myself rolling up in my Red 911.

Then reality sets in, when I open the front door and I'm greeted by an empty house with two super cute but not so smart dogs.

[justadude]

Let me answer the question, with a question. Would you buy real estate in the United States right now?

That's a good rhetorical point. I sold a house a year ago thinking the market had peaked in my area. But prices kept going up. I do think they are softening now, but I think there is still some fluff in sales prices. Do you think Ukraine home values (the ups vs the downs) are roughly in step with US prices?

I'd think there would be some correlation but with a fair number of regional factors being quite significant.

[justadude]

Yes, it has been a place to park money, and yes there were troubles in the past with apartments being taken over.
The Odessa market has had many new build apartments over the last 5 years. Quite a bit of it high standard. many new apartments are "bare". You buy the shell and outfit it yourself. This makes it hard to price apartments that may be of vastly different quality in the same block. many blocks that are 5 years old, are fully sold, but only 1/2 apartments are lived in (or finished).
AS the population gets richer and everyone gets a car (usually 2nd hand from Germany) Parking is now a real issue. Parking spots are usually sold extra to the apartment (ie you don't get one unless you pay) so street parking places are scarce.
New Airlines are adding Odessa to their schedules, and Odessa is expected to keep moving forward economically.
I considered buying 5 years ago but decided to rent then, starting to consider it again. The prices certainly haven't fallen in quality blocks out along Fransusky Bldve over that time. Akardya builds seem more cheap and nasty, as built almost solely for holiday rental.

You seem to know the area quite well. Thank you for the info.

[justadude]

justdude...never buy a home in a foreign country unless you know you're gonna be there for 10+ years.  Just rent. Put your money in American stocks and bonds.

Why take risk when you don't need to.  You don't speak the language and will need real estate agents, lawyers etc to help you.  Another way to get scammed.

I don't know your investment strategy but as a finance guy who manages my own portfolio I would just invest in American stocks/bonds, etfs, indexes. Keep things simple.

My strategy is that I don't have a strategy. Although I was keen enough to buy a couple of properties in 2012 when houses were pretty much free in N California.

I have almost 100% of my portfolio is in real estate. And I have some cash with which I'd like to do something. 

[Manny]

If you wanted to live in Ukraine for more than 75% of the year, would you buy a place if you had the funds in cash and you could afford to lose all of your investment (although it would suck) if things went to hell?

Based on that limited criteria, yes.

But personally, I wouldn't invest a dime in what remains of Ukraine unless I knew the local market very well (and some guys here do).

I bought a place in Estonia about a decade ago. At that time it suited me and what I wanted to do. We used it for several years as a kind of dacha. When we stopped using it, we rented it out.

I'd theoretically invest in Russia; but I wouldn't in Ukraine. But those on the ground in Ukraine know way more than me.

[andrewfi]

Guile is pretty much right.
How do you plan on living in Ukraine for more than 75% of the year?
Which of the categories do you fit?
https://usa.mfa.gov.ua/en/consular-affairs/services/new-visa-rules

As a foreigner moving to a new country, the last thing you need to do is buy real estate there. First sort out your ability to remain. Next, sort out your capability to remain, then sort out where you'd like to live, based upon your growing local knowledge. When you've got all that sorted, in a year or so, then looking to buy might be worthwhile.

If you've gotten all your ducks in a row you won't need to ask for advice here. If you need to ask advice here then you ain't in a place even close to being ready.

Personally, I rent. Not in Ukraine, of course but for the flexibility and security it gives. Housing as a service is a great way to go if one is not living in the place for large parts of the year.

[Contrarian]

Yes, it has been a place to park money, and yes there were troubles in the past with apartments being taken over.
The Odessa market has had many new build apartments over the last 5 years. Quite a bit of it high standard. many new apartments are "bare". You buy the shell and outfit it yourself. This makes it hard to price apartments that may be of vastly different quality in the same block. many blocks that are 5 years old, are fully sold, but only 1/2 apartments are lived in (or finished).
AS the population gets richer and everyone gets a car (usually 2nd hand from Germany) Parking is now a real issue. Parking spots are usually sold extra to the apartment (ie you don't get one unless you pay) so street parking places are scarce.
New Airlines are adding Odessa to their schedules, and Odessa is expected to keep moving forward economically.
I considered buying 5 years ago but decided to rent then, starting to consider it again. The prices certainly haven't fallen in quality blocks out along Fransusky Bldve over that time. Akardya builds seem more cheap and nasty, as built almost solely for holiday rental.

Are you currently living in Odessa, Ukraine or do you just visit often?

[BillyB]

Bought two apartments in the last couple years. Put them in my wife's name. With the troubles in Ukraine the dollar is very strong there and when the troubles are over, we anticipate we'll be able to sell and make a big profit.

I wouldn't worry about buying as a foreigner. Ukraine needs friends and the more investment in Ukraine by people from Western nations, the more likely those citizens will pressure their governments to help Ukraine should they get invaded.

[justadude]

Bought two apartments in the last couple years. Put them in my wife's name. With the troubles in Ukraine the dollar is very strong there and when the troubles are over, we anticipate we'll be able to sell and make a big profit.

I wouldn't worry about buying as a foreigner. Ukraine needs friends and the more investment in Ukraine by people from Western nations, the more likely those citizens will pressure their governments to help Ukraine should they get invaded.

I agree with this^^. Do you mind sharing what part of the country they are in? Anything else you can say about them, without giving away anything you wish to keep to yourself?

Strong property rights, both for citizens and non citizens are one of the biggest reasons people invest in the US, I think. In fact, I'd go as far as saying protecting my property with an effective titling system for real estate and valuable cars, along with other property rights protections, is perhaps the most valuable thing my governments (State and Federal) give me. Maybe give is the wrong term because they sure collect their fees. 

Certainly there are those within the Ukrainian government who understand that Western style prosperity is not possible without continuing to strengthen property rights laws to the point where foreigners like me wouldn't hesitate to invest in real property in their country. More buyers = higher demand = stronger prices and more stable markets.

Ukraine is not Chad, Africa in this regard, but it's not Spain, either. Just off the top of my head I'd have far less hesitation to buy real estate in Spain, the UK, Germany, Canada, or a bunch of other Western countries.

I know Ukraine is not Belarus, either, but I can't forget what happened to my ex Belarussian GFs family friend while we were together. His business was doing very well with multiple locations and the next thing he knew he was in prison on trumped up charges and his holdings were confiscated. She wasn't the type to exaggerate. On the other hand, she did fall in love with me, so her judgement is suspect.

Every once in a while I get excited about buying a place somewhere far away. I almost went into escrow on a house in S Cal a few weeks ago, but decided to wait until winter at least, seeing if prices soften a bit, as I still have a place up North and I don't need to rush. Whether or not I do that doesn't necessarily affect whether I'll buy a place overseas. I'm considering a couple areas in South America and Western Europe as well. I'm probably too chicken to do it, but I like to gather information, visit potential places and dream about it.

[BillyB]

Do you mind sharing what part of the country they are in? Anything else you can say about them, without giving away anything you wish to keep to yourself?

Both are in Ivano-Frankisvsk, far Western part of Ukraine. Bought both apartments new before they and the buildings were completed. If you got money to spare for an investment, your dollar is strong and Ukraine's currency is weak so there's a lot of potential reward in buying property in Ukraine.

[Guile]

justdude, it seems like you bought the real estate "dream" hook line and sinker.  now I know SoCal has done exceptionally well and if you have a house in SF or LA you are probably sitting on a multimillion dollar windfall.  But the big crash in 2008 wasn't that long ago. Vegas, Arizona, Florida..

BillyB's wife is Ukrainian.  You are a single guy who has no ties there.  What if after 6 months or a year you decide you don't want to live there.
Just rent.

I would buy stocks/bonds.  Far more liquid and less risky. 

I think you are infatuated with living in a foreign place, finding a girl from there and happily ever after.... Financially you would be ruined if the gov took your money or something screwed up. 

Go to Moscow, rent an airbnb for 3 months in the summer and hit on every single girl you see at Red square. Go to all the local bars/clubs. Learn Russian.  I have expat buddies who are pictured with a new girl every week on FB! these guys are your typical frat boy/nerd types and even they are getting all sorts of action.

[andrewfi]

What's the betting that, just as he does in his homeland, is thinking of using home as trap? He'd not be the first.

Here's the problem with that strategy. The kind of home that you're likley to afford is unlikely to impress your victims as much as you might hope. Their expectations are probably higher than your ability to perform. A school teacher is just a school teacher, no matter how the real estate lottery paid out before his early/forced retirement.

What happens if you buy a place but it is not where victim number three wants to live?

Another thought, your own home is not an investment. It is not liquid, you can't sell at whim And almost certainly is not an ideal purchase in terms of its hopes for return. Investing in more liquid assets, assets that can be diversified, is going to help your wealth much more than an amateur attempt at balloon surfing using an illiquid asset as your vehicle.

Factor in your lack of local knowledge and you are likely to get fleeced like a sheep.

But do tell, on what basis would you expect to gain long term residency in Ukraine?

[msmoby]

Simple rule..

Rent before you buy..

You are single and might meet someone who would share your life .

Stick to property markets you think you know in your own country.

Unless you have a partner from Ukraine...don't do it.

[redroo]

I'm a FIFO, never spend longer than 90 days in 180

[andrewfi]

I'm a FIFO, never spend longer than 90 days in 180

That's fine, but our hero is wanting to find a way to stay over there for most of the year.

Also, he is not in any way settled in life.

With a decent chunk of cash he should be able to get returns on his investments that would more than pay rent on a decent place to stay and learn.

For once, moby is right. In our hero's position, renting makes much more sense than buying.

[justadude]

SoCal has done exceptionally well and if you have a house in SF or LA you are probably sitting on a multimillion dollar windfall. 

No that's not me. I did well by the standards of a high school teacher, but not that kind of money.

But the big crash in 2008 wasn't that long ago. Vegas, Arizona, Florida..

The part of N Cal I'm from took a pretty big hit also, which is what made it possible to buy what I did in 2012. I timed the market well, but my future is not dependent on repeating that good fortune.

BillyB's wife is Ukrainian.  You are a single guy who has no ties there.  What if after 6 months or a year you decide you don't want to live there.

The value of having a trusted partner that lives in Ukraine is not to be underestimated. It would be great to have that. But I realize that takes some time!

I would buy stocks/bonds.  Far more liquid and less risky. 

Would now be a time to take more of a position in Bonds? How do you feel about the stock market? It seems like we are due for a correction. It doesn't seem like a good time to move into a largely stock position for me right now.

I think you are infatuated with living in a foreign place, finding a girl from there and happily ever after....

I think you're right on up until the happily ever after part. I don't think there's one girl out there for me.

Financially you would be ruined if the gov took your money or something screwed up. 

If I buy I need to show self restraint and not spend more than I can afford to lose.

Go to Moscow, rent an airbnb for 3 months in the summer and hit on every single girl you see at Red square. Go to all the local bars/clubs. Learn Russian.  I have expat buddies who are pictured with a new girl every week on FB! these guys are your typical frat boy/nerd types and even they are getting all sorts of action.

I didn't know frat boy and nerd were synonymous terms. I've always thought the thing that frat boys have is confidence and an I don't care attitude.

[Guile]

The value of having a trusted partner that lives in Ukraine is not to be underestimated. It would be great to have that. But I realize that takes some time!

Would now be a time to take more of a position in Bonds? How do you feel about the stock market? It seems like we are due for a correction. It doesn't seem like a good time to move into a largely stock position for me right now.


If I buy I need to show self restraint and not spend more than I can afford to lose.

I didn't know frat boy and nerd were synonymous terms. I've always thought the thing that frat boys have is confidence and an I don't care attitude.

I meant that BillyB already has ties to Ukraine so it makes sense for him to buy.  You don't.  Renting is far easier. Plus if you live there most of the time are you gonna work there? 

I am always looooong the market.  I am talking 15-20 time frame.  Sure they are more volatile, but certain indexes like the S&P 500 pay dividends.  I've done real well with some stocks like Amazon, FB, Netflix, Apple, Google..

Don't take risk where none is needed.  Take 3-4 months to rent a place, live there and really see if it's for you.

when i said frat boys I am thinking of the ones who get drunk and high, do stupid stuff and are socially awkward with girls... you're probably thinking jocks and preppies

So, how's the Ukraine trip going along, have you set a date to get back?  And started talking to any new girls?

[justadude]

I meant that BillyB already has ties to Ukraine so it makes sense for him to buy.  You don't.  Renting is far easier. Plus if you live there most of the time are you gonna work there? 

I would have sufficient passive income that I wouldn't need to work. However, sitting around doing nothing is a nightmare for me. I would probably teach English again. Maybe I would buy a hospitality business of some sort.

I am always looooong the market.  I am talking 15-20 time frame.  Sure they are more volatile, but certain indexes like the S&P 500 pay dividends.  I've done real well with some stocks like Amazon, FB, Netflix, Apple, Google..

Yes you can't go wrong with that horizon. Mine is much shorter.

Don't take risk where none is needed.  Take 3-4 months to rent a place, live there and really see if it's for you.

I know that's the wisest thing to do but I don't always do the wisest thing.

when i said frat boys I am thinking of the ones who get drunk and high, do stupid stuff and are socially awkward with girls... you're probably thinking jocks and preppies

Yep! But these guys you see on FB, do you think they are representing what is really happening? I think it's pretty common for people to misrepresent/overinflate their success on social media.

So, how's the Ukraine trip going along, have you set a date to get back?  And started talking to any new girls?

Yes I have set a date but I have not yet bought a ticket. I never got a reply from you when I emailed you. I'd consider going to Russia instead. When is your next trip?

[Guile]

I would have sufficient passive income that I wouldn't need to work. However, sitting around doing nothing is a nightmare for me. I would probably teach English again. Maybe I would buy a hospitality business of some sort.

Yes you can't go wrong with that horizon. Mine is much shorter.

I know that's the wisest thing to do but I don't always do the wisest thing.

Yep! But these guys you see on FB, do you think they are representing what is really happening? I think it's pretty common for people to misrepresent/overinflate their success on social media.

Yes I have set a date but I have not yet bought a ticket. I never got a reply from you when I emailed you. I'd consider going to Russia instead. When is your next trip?

If you have enough passive income why is your time frame for investing so short?  Even people who lost 50% in the market in the 2008 financial collapse recovered everything back a few years later if they didn't sell.

I have my nest egg which gives me dividends, interest and I don't touch the principle. If I have enough profit from certain stocks I sell and take the gains.

Well those guys on FB are people I know and have met in Moscow, hung out with them in bars/cafes.  They are just party dudes who like to hang around alot of women! 

Once I get my next gig I will be heading back to Russia. Hopefully by the end of the year.  Will try to e-mail you, just that I never use that account.  Easier on the forums.