Tuesday, May 27, 2008

Bucharest Apartment Prices Saw First Decrease In Feb ‘08

Apartment prices in Romania’s capital city Bucharest have increased three times since January 1, 2005, but lowered this year in February, for the first time, according to the real estate index computed by global real estate services company Colliers International.
The company’s general manager, Bogdan Georgescu, told a press conference that February 2008 was the only month to see a decrease in house prices over the past three years.

Thus, the average price of an apartment in Bucharest reached EUR1,826/square meter in January, but lowered to EUR1,776 in February. Prices then climbed to EUR1,887 in March and to EUR1,888 in April.

Colliers officials estimate the prices of newly-built apartments will range between EUR1,150 and EUR2,200/square meter, VAT included, stressing the prices of old apartments might lower by 5 to 15%.

Late May, Colliers International launched a Romanian quarterly real estate index, the first of its kind in Romania, to keep track of the country’s booming real estate prices.

“This is the first real estate index in Romania and will measure the residential market in Bucharest. The Bucharest Real Estate Index, or BREI, will track the evolution of apartment prices in Bucharest,” Colliers said in a statement.


Source: http://www.mediafax.ro/engleza/bucharest-apartment-prices-saw-first-decrease-in-feb-08.html?6966;2667202

Prices for old flats in Bucharest fall by 10-15%

The prices of old flats in districts like Drumul Taberei and Militari in Bucharest have fallen by 10-15% since the beginning of the year, despite the fact that owners keep asking for the same prices, real estate market brokers say.

The representatives of the magazinuldecase.ro website, which is currently listing almost 3,000 homes, say the decline is the outcome of a shrinking solvent demand for homes in Bucharest, while the supply of both new homes and old homes is rising, considering some of the speculative investors put their flats up for sale at the beginning of this year.

"This used to be a sellers' market until recently, where prices would not be negotiated because no ad would stay up for more than two or three days without the home being sold. As a number of investors feel a degree of panic, we may now be talking about oversupply, considering the decline in the number of solvent buyers and the increase in the supply of homes," stated Matei Malos, the general manager of the company that owns the website. The supply of old flats increased by almost 50% in the first quarter of this year, after the number of homes put up for sale totalled almost 15,000.

However, the average asking price for old flats in Bucharest remains at 134,000 euros, the same as at the beginning of the year.

The price decline mostly affects the districts on the outskirts of the city, whereas prices in the central and prime central locations remain unchanged, given the constant supply.

"Those under pressure to sell generally agree to cut the price by 10 or 15% even in central areas, while those who are in no rush continue to ask for the same price. Last year was a very good year, but early this year we noticed a 20-30% decline in the number of deals," states Daniel Raeceanu, the general manager of real estate agency Rasig Group, which employs 36 real estate brokers.

The prices of old homes in Bucharest went up by almost 50% last year and the depreciation of the RON against the European currency, joined by the increase in interest rates, made it harder for buyers who took out loans to repay their instalments. "While the supply was low and demand was constant, owners drove prices up to a maximum that peaked at the end of last year. Seeing that the interest rate is no longer what it used to be, investors have panicked and lowered prices by 5-10% during the last two months, especially in low-cost districts," adds Claudiu Hategan, branch manager of the Opera Center branch of Coldwell Banker Affiliates of Romania, which brokers deals with homes in sectors 4,5, and 6 of the capital city (Berceni, Drumul Taberei, Militari).

According to the real estate index put together by ZF based on the offers on anuntul.ro website, the average asking price for old three-room flats in Bucharest was 2,070 euros per square metre at the beginning of the year, an increase of 2% compared with the beginning of the year.

As far as new flats are concerned, 6,000 units are expected to be delivered this year, which could be a record on Bucharest's residential market, considering the number of flats completed over the last four years did not exceed 3,000 units a year.


Source: http://www.zf.ro/articol_173708/prices_for_old_flats_in_bucharest_fall_by_10_15_.html

Wednesday, May 14, 2008

Colliers to launch a real estate index for Bucharest in May

At the end of May, real estate consultant Colliers International will launch a quarterly real estate index, the first of this kind in Romania achieved by a company of this kind, which will monitor the evolution of housing prices in Bucharest.
"This is the first real estate index in Romania and will be a measuring tool for the evolution of Bucharest's residential market. The Bucharest Real Estate Index (BREI) will monitor the evolution of apartment prices in the Capital and represents a reference point in the professional development of Romania's real estate market", reads a Collier release. BREI will have 2005 as starting date for the analysis and will be published quarterly. The index will be launched at the end of May, together with a virtual real estate exchange through which those interested will be able to get familiarised with investments in these markets.
Colliers will provide more details about the Real Estate Exchange in the forthcoming days.
"If, until now, most opinions on the Romanian real estate market were mainly based on rumour or personal opinions, through this index we want to offer those interested in this dynamic market an objective instrument for the analysis of price evolution and future tendencies", declared in the release Colliers Real Estate Department Manager, Ilinca Păun.
The index was achieved by a team of consultants and analysts of the company and is based on eight secondary indicators that monitor price evolution in the six sectors of Bucharest, both for the older apartments in the blocks built before 1990, and for those in the new residential projects, built in the recent years.
Each sector was divided in districts, and for each district offers and transactions from certain areas were chosen, following a calculation algorithm based on the weight of sales according to quality and price. Also taken into account were the differences between the ways to measure and express areas, but also other factors that influence the apartments' final price per sq.m.
"We have obtained an indicator having at its basis the way to create capital market indicators in Europe, but which also takes into account the volume and the share of sales in certain areas, and the new deliveries of apartments in the market", said Călin Bucur, the coordinator of the group of analysts.


Source: http://www.curierulnational.ro/In%20brief/2008-05-14/Colliers+to+launch+a+real+estate+index+for+Bucharest+in+May