The Price of Agricultural Land in Ukraine Will Reach $2200 by the End of 2025
Ukraine has had a free land market for four years now. Since July 1, 2021, two key stages of land reform have taken place: first, individuals were granted the right to purchase land, followed by Ukrainian legal entities.
This is reported by AgroReview
The Impact of Land Reform on Leasing
The introduction of a free land market has not significantly affected leasing relations. There are isolated cases of increased rental prices, mainly related to the expiration of lease agreements or the purchase of plots that were not under lease. At the same time, after the implementation of electronic trading by the State Land Bank in the ProZorro system, most land lease agreements now occur through auctions. This has created heightened competition among private investors and contributed to an increase in rental income by 20-40%.
“There are individual cases of increased rental prices (and this is only where lease agreements are expiring, or a plot was purchased free of lease). But overall, we see that after the introduction of electronic trading by the State Land Bank in the ProZorro system, many auctions from private investors for leasing occur precisely through electronic trading. Competitive bidding at auctions increases income by approximately 20-40%,” noted the founder of the Volodar land agency, Volodymyr Nahornyi.
Forecasts for the Growth of Land and Rental Prices
According to expert forecasts, in the coming years, prices for agricultural land and rental fees will continue to rise. One reason is that Ukraine has lost about 25% of its territory, significantly increasing competition for available land resources. Additionally, a significant number of farmers have moved to the western part of the country, creating additional demand and excitement for land in these regions.
Experts estimate that rental prices for land in Ukraine will increase by 5% annually in dollar terms, while the price of one hectare will rise by 10% each year. Thus, by the end of 2025, the average price of one hectare of agricultural land could reach $2200, while currently, this figure stands at about $2000.