Prices for new homes will grow as developers are facing higher construction costs and deal with surging inflation, mentioned speakers during the residential market panel of SEE Property Forum 2021, Property Forum's annual event in Bucharest.
Alin Popa, Business Development Director, Residential at Crosspoint Real Estate, who chaired the panel pointed out that the past two years set records on the Romanian market, especially on price gains for residential units.
Home prices will go up next year due to the health crisis, the spike in construction costs and a limited supply of residential units, suggested Laurentiu Afrasine, CEO of Akcent Development. He added that investors snapped some 15% of the apartments in the company's Cloud9 project.
In the next six months, we will surely see prices go up because we have a big demand in the market, pointed out Attila Beer, Country Manager of Alukönigstahl Romania. One cause of the price increase is inflation that has continued to grow.
Irina Caraene, Sales Manager at Cordia Romania mentioned that there has been a higher demand for 2 and 3-room apartments with additional space for office in the company's new residential project in Bucharest. According to Caraene, prices for new apartments will grow due to the integration of energy-saving technologies and amenities.
Prices for apartments are growing because the incomes of Romanians are increasing, according to Oriol Casellas Deig, CEO of Meta Estate. He went on to say that real estate investments are a hedge against inflation so higher demand will put upward pressure on prices.
The construction costs for homes are lagged in the economy at six to eight months and prices will increase exponentially, explained Bogdan Doicescu, Head of Real Estate Division at Bog’Art. He added that construction firms have to be careful at the speed at which costs are transferred in the market.
Alex Skouras, Managing Partner at Alesonor, said that although there has been a significant increase of construction prices, the overall construction cost in Romania was and still is low compared to other peer countries in Europe.. Nonetheless, buyers have realized that part of the cost increase will be reflected in the final prices of homes. Skouras added that people are looking for a sustainable community with gyms, schools, and other essential facilities.
The developments in energy costs and the ongoing health crisis have led to a slight slowdown in sales compared to last year, according to Liria Themo, Marketing Manager at Atria Urban Resort. She thinks that prices will rise a little bit, but developers have to be aware that the concept is particularly important in these times.
