“Sales have stopped. We haven’t scheduled any signing since the onset of the pandemic, March 11. No one backed out of their promise to buy, despite the fears. Out of the people who signed a contract, fewer than 20% called to ask about the progress of the project,” say the representatives of Roka Residence, a developer with 223 homes under construction in the Timpuri Noi area and developed by Tomah Kahled.
The project is 53% pre-sold with 91 apartments and six offices of the 22 retail and office spaces still available.
“Work on the construction site continues,” the officials of the project say.
The halt in sales is what developer Lucian Azoitei talks about.
“Selling to customers is out of the question, everything is frozen for the time being. People are not thinking about homes, they are thinking about the pandemic. It’s something unseen before because no one knows what will happen and how things will develop, customers have put everything on hold to wait and see where things go from here,” says Lucian Azoitei, real estate developer who has built several projects in Bucharest.
He is now developing a complex near Mihai Eminescu and Stefan cel Mare, an almost EUR10 million investment and another one in the Titan district.
“We are preparing two more projects we did not stop; we’re going ahead with them. (…) Construction is going as it should, but we are rather atypical, in that we have our funding 100% ensured and our projects are sold.”
Customers are still waiting, fearing banks might freeze mortgage lending completely.
“They are not backing out, they still want the apartments, because they’re their homes,” Azoitei says.
The residential market was going through its best time ever, the real estate developers said not long ago, following a record number of deliveries in 2019.
The pace could change over the coming period.
“There will be a comb-out of real estate developers and I hope this doesn’t affect the image of the entire sector and does not send a negative message. I hope banks won’t stop funding. If they do, no one will be building any more and we’ll have a serious shortage of real estate projects over the coming years which will lead to aggressive increases and that is not good for the market,” Azoitei added.
Two weeks ago, Antoanela Comsa, the chairperson of the managing board of the real estate investor association AREI and CEO of Gran Via, the developer working on such projects as Gran Via Park and Timisoara 58 in Bucharest, said that the problems caused by the situation in Italy and Spain, two major sources of construction materials, along with a slowdown in demand and potential problems that could occur on construction sites, would affect the local real estate market.
The year 2019 was the seventh year of growth in a row for Romania in terms of new home deliveries, and the ninth in Bucharest, National Statistics Institute data show.
A total of 67,152 homes were delivered in Romania in 2019, 13% more than in 2018 and the highest number of homes delivered after 2008-2009, according to the National Statistics Institute.
More than 14,800 new homes were delivered in Bucharest and Ilfov last year, 32% more than 2018, which was the second highest growth after the 42% of 2013.
(English version by Loredana Fratila-Cristescu)