Ukrainian Investment?

[AkMike]

We all know how attractive the ladies are in Ukraine..
 Here's a bit more to think about.  This is the bank I used over there for my apartment purchase. They are one of the largest in the country and because of the size IMO they're modestly safe. NO FDIC type insurance from what I understand.

Other than having an account I have no commercial interest in this bank..  Just passing this along for you to think about.


http://www.aval.ua/eng/personal/accounts/deposit/

[IAmZon]

This is a dialog well worth having.

I know that many of my Romanian friends - and they are 30 years and below, have already become a little established by American standards; however, they have taken their savings and invested back into real estate in their home towns with APPARENTLY great success.

I imagine Ukraine is similar (Saber rattling with Putin clearly add risk upon risk).

Any board member have experience, observations to contribute.

[ScottinCrimea]

My experience with my real estate investments in Ukraine is that I have gotten a return well above what i could have hoped for. Of course with any investment there is a risk, but look at what has happened to many who have invested in the "secure" US real estate market.

As far as depositing money into Ukraine banks, it's hard to ignore the interest rates, but a couple of things to keep in mind are that the insurance on deposits are minimal and they will charge you a percentage to remove any funds from the bank, IIRC it's 1%.  then you have to be sure that you have all of the necessary documentation to get the money out of Ukraine.

As far as fearing that the banks will go under, in the past that was definitely a concern, but there has been significant investment in Ukrainian banks by foreign financial groups and so the chance is much lower now, especially with some of the larger banks like the one noted in the link.

[Mir]

Certainly on paper the increase in property prices in Ukraine for the period 2004-2007 has been more than anywhere else. Some claim that property in Kiev is the most expensive in Europe:

http://www.moneyweek.com/file/23678/what-kievs-property-boom-and-dotcoms-have-in-common.html

Scott

Have you actually sold any of your properties? What was the return?

[AkMike]

I hope that my apts. will be finished mid 2008 if it continues according to plans.
 I plan to sell one of them as soon as we finish it out. It'll be interesting to see what if any profits I'll be able to get.

 What kind of paperwork is needed to transfer funds from Ukraine?

[ScottinCrimea]

I have no intention of selling any properties as we see them as longterm investments and some have significant income-earning potential that will provide a nice retirement income.  Just as a point of reference, though, if we were to sell our apartment that we purchased around 3 years ago, our return, even without all of the upgrades, would be around 100%.  Add the upgrades and you're looking at something like 125%.  I think the returns in Kiev have been higher than in Simferopol, but it's trickling down and should continue for at least a couple of years after Kiev peaks.

AkMike,  to transfer funds from Ukraine you need to have a clear paper trail of where the money came from.  For example, if you document how much money you transferred into an account in Ukraine and then have documents showing sale of a property and the sale amount, theoretically you should be able to transfer this amount out of Ukraine.  Some banks are better about this than others.  I would recommend talking with someone who has more experience in this area if you're planning to ultimately transfer the money out of Ukraine.

I remember when I first opened an account at a bank in Ukraine I wanted to deposit $1,000 cash to open the account.  They refused to accept the deposit because I didn't have documentation of where the money had come from.  They did open an account for me, though, so basically I had an account with zero money in it.

[AkMike]

IIRC I deposited $10 to open the account so I could get the routing numbers and such to do an electronic bank to bank transfer.
 I plan on leaving the money there for retirement also.We hope to spend summers there and winters in Alaska. But with the changes in their visa requirements, it looks like we'll have to find the right person to give a "gift" to in order for me to stay for 6 months at a time.. If that's possible...

[ScottinCrimea]

What may have happened is that they charged you a $10 fee to open the account.  Even though I had no money in my account I was still able to use it for fund transfers, etc., which was the original purpose.

If you have any plans on staying in Ukraine for more than 3 months at a time, you're going to need a multiple entry visa. With these you can come and go as often and as many times as you want for a five year period, with the limitation that you must leave and then re-enter every 6 months (this can still be the same day as you just need the exit stamp).  Then you just obtain a new one after five years.  I wouldn't advise overstaying the three month non-visa period as they may place a nasty stamp in your passport that will make it difficult to return.