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Real Estate : Number of completed buildings in 2011 in Bucharest down 41 pct compared to 2010
The number of the residential buildings completed in Bucharest last year stood at only 1,600, down 41 percent compared to 2010, according to the report the Jones Lang LaSalle company sent on Monday.
The request for new apartment buildings was sluggish both in 2011 and at the beginning of 2012. The evolution of the mortgage loan has slightly surged in the second half of 2011, whereas a meager dynamic has been recorded in the first three months of 2012.
'An incredibly high number of residential projects has been announced on the Bucharest residential market and metropolitan area. But, by the time being, only some have been completed or even worse, many projects have vanished, have entered insolvency or have been declared bankrupt. The local market is under the sign of distrust, which affects the trading activity during the construction stage of the residential projects and on which the subsequent funding of the projects in fact depends,' the report reveals.
In Q1, 2012, the prices went down 4 percent on average. While 2011 was characterized by a slight increase in the average prices, 2012 is expected to see a more drastic correction in prices.
'A slight increase of the residential area is foreseen in 2012. Amid a moderated optimism, some expect stable sales, while other developers are expected to announce new projects. The prices will most likely suffer other corrections,' the aforementioned study reads.