Wenzhou investors pay dearly for Ukraine buys

Russia's invasion has dealt a devastating blow to Ukraine's real estate market, and some Chinese investments in the country's property market may have been wiped out.

Before the conflict started many Chinese investors took advantage of the tension in Ukraine and bought properties when the prices were down.

Investors from Wenzhou in Zhejiang, hometown for many who are successful in business, entered the property market, noticeably in Lviv, a major city in western Ukraine.

Some Wenzhou merchants turned to western Ukraine to buy homes as they believed a switch to over there would turn out to be a winning tactic in the wake of them suffering heavy losses in the Chinese property market in recent years.

There was also the fact that Ukraine has been the third-largest trading country in eastern Europe for Zhejiang, with more than 1,000 people from the province in the country along with 34 Zhejiang enterprises.

But with the invasion and the decline in Ukrainian property prices those investors now regret buying in a rush.

There are also fears of cash-flow problems as at best it will take considerable time to recover from any of the investments even after hostilities end.

One Chinese investor living in Ukraine had called on the internet for "bottom-fishing" activities after the Russian invasion when Kyiv property prices had fallen by 60 to 70 percent, from 7,000 yuan (HK$8,650) to 8,000 yuan per square meter to only 2,000 yuan.

But he reversed his thinking within a few days and even shed tears while livestreaming because he was experiencing some of the horrors and was stranded in a war zone.

Another Chinese investor bought a few flats in June when the situation in Ukraine was unstable as he thought that the prices were low even in the strained circumstances.

The properties he owned were not affected directly by the war, but their prices dropped significantly.

He was last heard of bitterly regretting his decision.