The Impact of War in Ukraine on House Prices

The war in Ukraine has had a significant impact on most economies around the globe – therefore it comes as no surprise that it also affects house prices.

Higher House Prices Due to Inflation

Especially, the conflict has led to an increase in inflation rates, you probably already noticed it, no matter which country you live in. In some countries – due to this inflation – prices are increasing faster than wages. As a result, people are getting poorer and possibly can’t afford to buy houses anymore.

Many people already gave up looking for the cheapest property for sale. There still are some out there but usually those are in need of some work and further investment to be able to live in them or rent them out.

The cheap houses for sale, now seems to be those that were just a normal price before. Especially in bigger cities there is a shortage of housing. Also, when it comes to creating new housing, they are usually luxurious expensive stuff – as there is just a lot more money to be made.

How the War in Ukraine Affects House Prices of Newly builds

First the pandemic and now war, those has been major factors in the shortage of building materials. This in turn has led to a considerable increase in the price of new build houses all around the globe.

Also the increase in gas and energy prices have been a great hit in the market. Running machinery on the construction site, having to pay higher wages – all of this contributes to an considerable increase.

This might be felt stronger in some countries than in others.

What are the Effects of War on Housing Markets?

Housing markets are always affected by wars. The effects of war on the housing market depend on a lot of factors, including the duration and intensity of the war, the location of the war, and how it affects other countries and other aspects of life.

War can lift housing markets in some cases. For example, during World War II there was a shortage in construction materials like steel and timber. This led to higher prices for these materials and an increase in demand for homes as people wanted to buy houses before they became too expensive.

However, most wars have negative effects on housing markets. For example, during World War I there was an economic depression that led to lower demand for homes because people were not earning enough money to afford them.

Conclusion: The Impact of War on House Prices

The conflict has led to a significant shortage of houses and higher prices for those that are available. This is due to the increased cost of construction materials, as well as the number of refugees fleeing from the conflict zone. These people need housing but there is not enough supply, leading to higher prices and shortages.

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How Covid-19 affects house prices

Experts are far from agreeing how Covid-19 affects house prices. Most pros advise investors to stay calm.

There is no clear answer to the question of how the prices for residential or commercial real estate will develop as a result of the Covid-19 pandemic.

House Prices Forecast

The forecasts range from price drops of up to 25 percent to stable prices and even further rising rents to further price increases.

We are currently in a situation that never happened before therefore it is very difficult to predict the outcome as we cannot compare it with any other time in history. There is one thing though experts agree on which can be summed up in the following quote

“There is only one thing certain and that is that nothing is certain.”

— Gilbert K. Chesterton

House prices forecasts are for this year or a maximum of twelve months. Afterwards, the experts seem to agree, the prices tend to go up rather than down. All on the premise that the recession will be overcome by 2021 at the latest. Nobody speaks of a price bubble that could burst.

Corona would at most lead to a cycle break, meaning a temporary interruption of the general upward trend.

Real Estate is “concrete gold” – a rather safe investment

Although the price boom we saw before covid-19 would be a thing of the past, real estate seems to stay a rather safe investment compared with other ventures.

Researchers cite five factors for their forecast of short-term price declines: rising interest rates, less influx into booming cities, emergency sales due to less liquidity, for example among freelancers, fewer new buildings and less demand from investors.

The good news for home owners is that we currently have no indications of falling house prices.


Capital investors who were interested in buying an apartment before the epidemic are advised to simply pursue their plans. Residential properties still offer relatively good returns.

Conclusion

People need to live somewhere. Even if some who were planning to buy a house can’t do it anymore due to financial difficulties, they still need a place – meaning they rent a place, which in return is good for the owner as he receives the rent.

Surely, we always like to get a good bargain that’s why some buyers are hoping that the current situation will make houses more affordable.

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The effect of transport links on your house value

Recently a new section of the LUAS tram was opened in Ireland’s capital city Dublin. It was noted that the effect on house prices within the areas now linked by the tramway to the city centre was significant. This shows that transport is linked to house prices.

What was also significant was that the effect on house prices was in fact felt about 2-3 years rather than at the time of the opening of the line. The reason for this was that the line was planned and as such people became aware that the areas would soon have the new city centre link. Continue reading The effect of transport links on your house value

Will brexit affect house prices in Ireland?

No one can doubt that house prices in Ireland are again rising.

It appears Ireland is up between 45-50% from its lowest point 5 years ago. It is also generally accepted that Dublin has seen the biggest increases whilst areas furthest from the capital have seen the smallest. Continue reading Will brexit affect house prices in Ireland?

Will Brexit effect house prices in the UK?

It is generally agreed that Brexit will have little or no effect on house prices within most of the UK.

Demand for houses has remained high; there are simply not enough houses and this inevitably means prices will continue to rise because the laws of supply and demand demand it (if you get my meaning!). If people were moving as a result of Brexit the situation may be different but evidence suggests very few are doing this. Continue reading Will Brexit effect house prices in the UK?