One condition for selling new apartments is to make sure they don’t exceed the area and price of old apartments nearby, say real estate consultants.
This autumn came with new price declines for the market of old homes in Bucharest. The price of three-room apartments has reached EUR74,900, down 4% (by EUR3,000) against the beginning of the year, according to the real estate index built by ZF in collaboration with real estate consultancy Coldwell Banker Affiliates of Romania. The index has hit a fresh low.
Construction of new apartments fell by 8% decline in the first nine months of the year, according to the National Statistics Institute. 26,654 new apartments were delivered, a level close to 2007, when the market was still growing.
On a regional basis, data of the National Statistics Institute shows a significant decline in north-eastern and central Romania (northern Moldavia declined 16% in the first nine months, while central Romania fell 26%). A stabilization was recorded in southern Romania – Muntenia, in western Romania and in the Bucharest- Ilfov area, while home construction rose by around 400 units in Oltenia (south-western Romania).
In fact, in the third quarter in the Bucharest-Ilfov area the number of finalized homes rose slightly, by 6.7%, to 1,266 units, after new stages were delivered in several projects, as well as thanks to small developers returning to the market.
What do consultants say?
“Things have improved on the market. There are several small developers who built apartments adapted to the market and a set of projects that have been resumed,” says Gabriel Voicu, manager of the new homes division within real estate consultancy Coldwell Banker Affiliates of Romania. Coldwell has around 2,500 new apartments for sale in Bucharest and the surrounding area.
“What should a new project look like in order to sell? It has to be close to public transportation, the area of the home should not exceed by more than 20% the area of neighboring old apartments, and the price should not exceed by more than 10-15% the price of nearby homes,” says Voicu, who runs a division that has sold over 200 new homes in the last few months.
Declines are no longer spectacular
Despite several developers returning to the market, the price decline continues and this has also been noticed by consultants.
“Prices continued their downward trend, but the declines are no longer so spectacular – we are talking about something like 5% a year. And in a negotiation you can get an additional 5-10% price cut,” Voicu also says.
(English version by Daniela Stoican)