The Rada adopted the law on property valuation: what will change for Ukrainians and how will it affect EU assistance

The Verkhovna Rada of Ukraine has adopted a law that radically changes the property valuation system and brings it closer to European standards. The document provides for new rules for determining the value of real estate, land plots and damage caused by the war. In addition, its adoption is one of the conditions for Ukraine to receive international financial assistance.

On October 14, the parliament supported in the second reading and as a whole Bill No. 13435. 272 ​​people’s deputies voted for the relevant decision.

The document is to replace the law on property valuation, which has been in force since 2001, and bring Ukrainian legislation in line with international and European standards IVS and EVS.

What will change in the valuation of real estate and land

One of the main innovations concerns the valuation of land plots and real estate.

The law provides for the abolition of a separate expert monetary valuation of land plots and the introduction of a unified approach to the valuation of real estate together with land.

The document also distinguishes between independent and standardized valuations, establishing the rules for their application.

Particular attention is paid to determining the value of property damage caused by Russian aggression.

It is expected that the new rules will help make valuation procedures more transparent and reduce the risks of artificially understating or overstating the value of property.

New rules for appraisers: register, control and fines

The law provides for large-scale changes in the professional activities of appraisers.

In particular, the following are being introduced:

A unified register of appraisers of Ukraine, which will contain information about specialists.

The ability to confirm advanced training once every three years using a simplified procedure.

A unified self-regulatory organization of appraisers.

A three-level control system with the participation of the State Property Fund and the Qualification and Disciplinary Commission.

New rules for checking and reviewing property valuation reports.

Fines for violating established requirements.

In addition, a mechanism for pre-trial appeal of disputed decisions through a special appeal committee is envisaged.

A simplified procedure for access to professional activity in Ukraine is being introduced for foreign specialists.

Requirements for the evaluation methodology will also apply to judicial experts, who will be subject to disciplinary liability for violations.

How the law will affect the real estate market

It is expected that the update of the legislation will reduce the number of cases of manipulation of the value of property during its evaluation.

Among the predicted results are an increase in tax revenues, a reduction in budget expenditures for administering the system, and increased market transparency.

At the same time, the actual impact of the changes on evaluation procedures will depend on the practical implementation of the new rules.

Ukraine may receive $4.2 billion in international aid

The adoption of draft law No. 13435 is one of four legislative decisions necessary to unlock the European Union’s macro-financial assistance under the Ukraine Support Loan program.

This concerns the possibility of receiving a second tranche of financing in the amount of $4.2 billion.

In addition, the document is related to Ukraine’s obligations to the International Monetary Fund within the framework of the EFF Extended Fund Facility program and is one of the indicators of the Ukraine Facility program.

Thus, the adoption of the law is important not only for reforming the property valuation market, but also for further financing of the Ukrainian economy by international partners.

At the same time, the parliamentary vote in itself does not mean the automatic receipt of funds – to receive financing, Ukraine must fulfill other conditions stipulated by the programs.