There’s no part of an economy that the smart application of a bit of information technology can’t make better, and real estate is no exception.
Take Zillow — the leading online real estate marketplace in the United States. It scours the web for all of the data it can find about real estate deals around the United States, providing users with valuable information about a property’s previous owners, price history, tax information, rental prices and forecasts.
So given that Ukrainian programmers certainly have the expertise to create a comparable service for the Ukrainian real estate market, why doesn’t Ukraine have its own version of Zillow?
It’s all about market maturity, according to Andrii Mima, who founded a Ukrainian online service for searching property, LUN.ua. The U. S. real estate market has a data set on property in the country that goes back at least 100 years. There’s nothing of the kind in Ukraine.
“In America, I can’t sell and you can’t buy a property without real estate agents, who will document our deal and then officially register it,” Mima told the Kyiv Post. “And this has been the case, I think, for 100 years. And of course, each property has a price and ownership history.”
Market mentality
Mima agrees that Ukrainian programmers have the technical skills to create a home-grown service like Zillow. The problem is the lack of the relevant data. Zillow, for example, uploads information from the website realtors.com, which was launched and is maintained by the U. S. National Association of Realtors.
Although there is an analogous association in Ukraine — the Ukrainian Association of Realtors or ASNU — the realities of the real estate market in Ukraine mean that reliable data are much harder to come by.
Eduard Brazos, head of committee of information systems and analytics at ASNU, says Ukrainians will, if they can, avoid using a real estate agent, which reduces the amount of data flowing into the market. And while in countries with developed economies and mature property markets a universal database is formed by associations of local realtors, that hasn’t happened in Ukraine yet.
Even if Ukrainians’ do-it-yourself real estate mentality changes, it will take time for realtors to set up a universal database. The electronic register of ownership rights in Ukraine was only created in 2013, and not all property is listed in this register yet, Brazos says.
Some data “are still lying around someplace on sheets of paper,” he said. “At the same time, Ukraine is a young country, and ownership rights to some property has only just been given — the privatization process is still ongoing.”
Data gap
With no universal database, various websites have stepped in to try and fill the data gap. But they generally are unable to check previous owners or the price history of a property, and differ in the amount of information they offer.
Global OLX is one such website. It offers a range of services, but a large part of the website is dedicated to real estate property ads. According to OLX marketing director Kateryna Onischenko, the website currently has 500,000 ads for buying or renting property. But the website is plagued by fake ads, and the service has been forced to set up a separate real estate department to call users and verify that an ad is above-board.
The problem with the quality of real estate property ads has prompted the company to launch a separate marketplace, Otodom, which ranks real estate property ads from best quality downwards, unlike the OLX website, which ranks ads only by publishing date.
“We’d much rather have quality than quantity when it comes to ads,” Onischenko told the Kyiv Post. “It’s important to give a full description, give correct information and provide good-quality photographs.”
Property consultant Nick Cotton, managing director at a leading real estate company, Cushman & Wakefield Ukraine, agrees Ukraine is a long way from matching the developed economies, but says the market situation is comparable to the ones in Central and Eastern Europe.
Ukraine has no statutory database of transactions or ownership, and there’s huge opacity in relation to quality of buildings, Cotton said.Moreover, Russia’s war on Ukraine has damaged the economy.
The Ukrainian property market “is obviously very depressed,” Cotton told the Kyiv Post. “We see a lot of speculative development ongoing. It’s a very long way from U.S. or U.K. levels of transparency.”
