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Real Estate: BNR Report: Real estate prices up 0.88 pct in 2018, slowest growth pace since September 2015
The price for residential properties reached the minimum growth pace last year, since September 2015, with the annual growth average, in real terms, recorded in December 2018 being of 0.88 per cent, compared with the same period last year, according to the Financial Stability Report of the National Bank of Romania (BNR).
In what concerns the credit institutions, the residential properties price saw a marginal growth in the first quarter of 2019, contrary to the expectations of a significant drop in the previous quarter. For the second quarter of the year 2019, credit institutions estimate a relatively constant evolution in the prices for housing.
In terms of the number of transactions recorded on the residential buildings market, it dropped in the second half of 2018 and, respectively, the first quarter of 2019 (-26 per cent in Q1 2019 against Q1 2018). On the other hand, the period of time one needs to sell an apartment increases up to 90 days (the average for the last quarter of 2018), compared with 81 days in the same period of 2017.
In the same period, the commercial real estate segment saw a modest evolution in rentals and the occupancy rate against the previous period.
In terms of the real estate buildings offer, it went on a mixed trajectory. For the residential buildings segment, the volume of residential construction works dropped 13 per cent in April 2018-March 2019 compared with the same period of the previous year, when the number of finished dwellings for 2018 was by 12 per cent higher than in the previous year.
In terms of the newly issued construction authorizations number, the evolution was heterogenous. While Bucharest recorded a 6 per cent drop, in the rest of the country the number of residential authorizations increased by 4 per cent. However, the useful square meter area related to the newly issued construction authorizations increased both in Bucharest (plus 6 per cent) and at national level (plus 9 per cent).
The commercial real estate market segment also saw an increase in activity, despite the increase recorded in the costs for work force and materials. The number of non-residential construction authorizations increased by 16 per cent in 2018 and by 5 per cent in the first two months of 2019 against the same period of the previous year.
The increase in the number of authorizations was accompanied by an increase in the required useful area, especially in the case of the segment of office spaces.