New property sells with difficulty, old apartments in high demand

Discussion in 'Romania property' started by David howe, Aug 11, 2008.

  1. David howe

    David howe New Member

    Below is an article published by nineoclock.ro a news channel.

    It endorses everything we have said about the Romanian market and that existing is the best investment. Romanians were reluctant to buy what they could not see and foreigners went in both feet first with effect we now see some really bad off plan evelopments finishing that no self respecting Romanian will touch. Couple this with developers and agents seeking to high a profit and this is great news for the market and allows for a realistic reallignment where quality dictates the market and greedy agents are forced out.

    From an investor point of view this is great news takinging into consideration that July and August are traditionally dormant months.



    Bucharest – Properties on new residential developments sell very slowly as, despite the still high demand, buyers hope prices will drop and, should this situation persist, many developers will exit the market, according to CB Richard Ellis/Eurisko.

    ‘We are being faced with a very slow sales rate. Should this pace continue, many developers will exit the market, creating an immense supply shortage on a market like Bucharest that demands 200,000 – 300,000 apartments at this stage. There are many interested buyers out there, most of them have already had bank loans approved, but they are not buying hoping for a miracle – a lower price a week or a month later’ company residential department head Ionut Bordei states in a press release. He thinks the expectation of buyers of new homes that the price will drop is unrealistic, because building costs are high and continue to grow.

    In his opinion, the residential market is government by two main situations: one where buyers listen to rumours and stop buying properties waiting for the price to drop, and a second one where developers who cannot decrease the price as the land is extremely expensive, building materials and labour are also getting more expensive and they also need to make a profit if they want to stay in business.

    Colliers: Bucharest old property prices slightly up in July

    Old apartments in Bucharest became slightly more expensive in July, but the price evolution was very much different from area to area: in district one, residential property prices were up eight per cent and they lost six per cent in district 6, according to the latest apartment price index by Colliers.

    A significant price rise was also reported in district 2, where the average price of EUR 1,685 / sq m are six per cent higher than in the previous month. Sectors 3 and four had small depreciation by one per cent, respectively 2 per cent, and sector five registered a two per cent rise in the average price per square metre.


    David Howe LLB. LLM

    INVESTMENT ROMANIA - Investment in Romanaia, Property management, Due diligence, Renting in Romania
     
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