--- title: "Serviced apartments vs. rental buildings: why rental ROI in Ukraine reaches 11% while mass housing awaits state support" description: "🏢 The serviced apartment market in Ukraine is showing explosive growth: returns up to 11% and payback 3-6 years faster than classic rentals. 💰 At the same time, the construction of rental buildings is hindered by the lack of long-term loans and tax breaks. Experts are calling for PPP to solve the housing issue. 📉 By the end of 2025, there were 105 income-generating real estate projects. Read the full analysis on XAB.info." date: 2026-08-13T16:26:04.000Z lang: en url: https://xab.info/en/posts/serviced-apartments-vs-rental-buildings-ukraine-roi-11-percent tags: [ukraine-real-estate, apartments, investment, rental-market, construction] publisher: "XAB.info" --- # Serviced apartments vs. rental buildings: why rental ROI in Ukraine reaches 11% while mass housing awaits state support ![Modern living room in rental apartments — example of high-yield housing in Ukraine with up to 11% ROI](https://xab.info/media/2026/08/13/apart-oteli-v-ukraine-dohodnost-11-protiv-dohodnyh-domov/apart-oteli-v-ukraine-dohodnost-11-protiv-dohodnyh-domov-1.webp) ## 🎯 Key Points - Serviced apartments in Ukraine demonstrate a return of 9-11% annually and pay off faster than classic housing. - Entry into the serviced apartment business costs from $40,000 to $80,000 per room. - The development of rental buildings is hindered by the lack of long-term loans and tax instability. - Experts propose a PPP model to create affordable rental housing. ### Serviced apartment boom: how investors earn up to 11% annually The short-term rental market in Ukraine is experiencing a true renaissance. According to LUN data, by the end of 2025, the country already had 105 income-generating real estate projects, with serviced apartments demonstrating the most rapid growth. The secret to success lies in the synergy between developers and professional hoteliers, who create ready-made business models for investors. Entry into this business ranges from $40,000 to $80,000 for a standard room, while premium lots can cost over $100,000. Experts at Ribas Group note that the financial model of such projects shows high efficiency. At the launch stage, during the first 1–3 years of operation, when the property builds a guest base and fine-tunes operational processes, the average currency return is 5–7% annually. However, from the third year, provided operations are streamlined, profits can rise to 9–11% annually. It is important to note that operating profit is distributed on an 80/20 basis, where 20% is the management company's commission for professional business management. ### Economic advantage: why serviced apartments beat the classics Comparative analysis shows that serviced apartments have a significant advantage over classic rental housing. With the same location and property class, serviced apartments pay off 3–6 years faster. This is achieved through higher occupancy rates and pricing flexibility. The gross return on serviced apartments exceeds classic rental indicators by 4–8%, while net marginality is higher by 1–4%. This makes the serviced apartment format attractive to investors seeking quick payback and high asset liquidity. ### Rental buildings: a perspective squeezed by the lack of state support While serviced apartments are flourishing, the segment of urban rental buildings, which could solve the affordable housing problem, is developing extremely slowly. According to LUN analysts, it is premature to call this sector actively growing. Co-owner of Standard One, Alexander Ovcharenko, points to fundamental economic barriers: a rental building pays off through rent over 10–15 years or more, not counting the construction cycle, which takes another 5–7 years. Such long investment horizons require stability, which is currently lacking. ### Barriers to entry: loans, taxes, and the need for PPP The main brake on the mass construction of rental buildings is the lack of cheap long-term loans for 15–20 years and project financing. Additionally, a critically important factor is the instability of tax legislation. Developers are ready to invest in long-term projects only on the condition that tax rules are fixed for the entire investment cycle. Alexander Ovcharenko proposes a solution through public-private partnership: cities could provide land on preferential lease terms and connect utilities, while developers could transfer 20–30% of apartments for affordable or social rent. Without such measures, rental buildings will remain a niche product for a narrow circle of investors. ## ❓ FAQ ### Q: What is the return on serviced apartments in Ukraine? **A:** The average currency return is 5-7% annually at the start and can reach 9-11% annually from the third year of operation. ### Q: Why are rental buildings developing slower than serviced apartments? **A:** Rental buildings require long-term investments (15-20 years) and suffer from a lack of long-term loans and state incentives. ### Q: How much does it cost to enter the serviced apartment business? **A:** The cost of an individual room or apartment varies on average from $40,000 to $80,000.