Housing market: the effect of pent-up demand and the upcoming crisis of new projects
The graph over the past four years clearly shows two key trends in the Ukrainian housing market:
- The number of commissioned facilities remains consistently high, although it fluctuates within the framework of previously launched projects.
- The number of new construction starts has fallen sharply, especially after 2022.
What it means for the market
Currently, developers are mostly completing projects that they started before the full-scale war. New starts are minimal, as the industry operates in a difficult environment: uncertainty, high cost of financing, limited access to loans and permitting procedures.
As a result, there is a growing gap between the "commissioned" and "construction started" lines. This is the main marker of a future shortage. In a year or two, the market will feel it to the fullest extent: amid growing demand, there will simply not be enough new apartments to meet it.
What is happening now
The eOselya and eRestoration programs stimulate demand by attracting thousands of new buyers, while supply continues to decline. Already, analytics show that most of the new buildings to be commissioned in 2025 were laid in 2020-2021.
Thus, the current rate of delivery is the inertia of past investments, not a sign of market recovery.
What will happen next
When pent-up demand picks up - thanks to economic stabilization, expansion of lending programs and the return of internal migrants - the shortage will become apparent. Under these conditions, the cost per square meter will inevitably rise, and the market may face a crisis in new housing when consumer interest exceeds supply.
This trend is already evident in large cities, especially in Kyiv, where the volume of new starts is the lowest in the last decade.
What you need to do
The Ukrainian market needs a new strategy to stimulate construction - through:
- transparent project financing instruments;
- government guarantees for mortgage programs;
- simplification of licensing procedures;
- attracting international capital to housing development.
Without this, the investment pause of 2022-2024 could turn into a systemic shortage of new housing starting in 2026.
