“Owners of older apartments, who are asking for less than €60,000 or slightly more than that, have raised their prices. Increases were of 10-15 percent, and are just for the time being. In two months, when loans will be granted again, owners will realize that they are not selling, and they will lower prices by more that the growth rate they applied,” the Head of Volksbank’s Real Estate Division, Daniel Tudor, told Business Standard.
According to the official, the state-guaranteed ceiling is limited, and the 16,000 loans that can be granted through the “First Home” program will quickly run out. Tudor added that the volume of loans granted by Volksbank amounted to €250 million per month in 2007, while as part of the “First Home” program the bank will grant loans of up to €50 mln.
“The negative evolution of the economy cannot result in price rises. Whoever expects such a thing should consider this scenario only as wishful thinking, in an uncertain future, once the economy bounces back, and very unlikely up to the level registered before. The drop in the residential market back to normal levels, due to the crisis, will take apartment prices to €500-1,000/square meter, depending on the location, making them accessible and in accordance with the market segment represented by most Romanians,” the Managing Partner of the Darian valuation company, Adrian Crivii, said.
According to an analysis by Colliers International, prices demanded by owners of older one-bedroom apartments in Bucharest soared 10-15 percent since the launching of the “First Home” program, meant to unblock the real estate market.
