Buying costs are low in Ukraine
September 06, 2016
How high are realtors’ and lawyers’ fees in Ukraine? What about other property purchase costs?
|Pension fund levy||1%||buyer|
|Registration fees||0.01% - 0.05%||buyer|
|Real Estate Agent’s Fee||3% - 5%||seller|
|Costs paid by buyer||1.51% - 1.55%|
|Costs paid by seller||3.5% - 5.5%|
|ROUNDTRIP TRANSACTION COSTS||5.01% - 7.05%|
| See Footnotes
Source: Global Property Guide
How difficult is the property purchase process in Ukraine?
There are no major restrictions on ownership of real estate (aside from land) by foreign individuals. The Land Code of 2002 allows foreign individuals and legal entities to own non-agricultural land in Ukraine, and non-residents can also lease land for a maximum of 50 years (all land purchase and lease contracts are subject to state registration).
The buyer should verify the seller’s title by reviewing the title documents. Title documents should include:
- a certificate of privatization, or purchase contract (usually notarized), or evidence of inheritance or gift;
- a certificate from the Bureau of Technical Inventory (BTI) stating that the seller is the owner and citing the BTI registration number; and
- a certificate from the Unified Register of Prohibitions on Disposal of Immovable property showing the absence of mortgages, arrest or other encumbrances.
The passport of both parties is also important. The notary also requires that the state duty and pension fund fee have been paid. After the purchase contract is executed before a notary, the buyer should then apply for the transfer of the property to be registered at the appropriate BTI office. Transfer only becomes effective when sale purchase documents are registered.
Footnotes to Transaction Costs Table
The round trip transaction costs include all costs of buying and then re-selling a property – lawyers’ fees, notaries’ fees, registration fees, taxes, agents’ fees, etc.
Pension Fund Levy
Pension fund levy is around 1% of the property value.
Registration fee and related costs are around 0.01% to 0.05% of the property value. The buyer typically pays for the registration fees and related costs, but it can be arranged to split the costs between the buyer and the seller.
State duty is around 1% of the property value. The law is silent on who pays for state duty. However, it is common practice to equally split the cost between the buyer and the seller. State duty is paid to the notary.
Real Estate Agent’s Fee
The real estate agent’s fee is around 3% to 5% of the property value.