About 12,000 housing units are currently under development in Bucharest and surroundings and could be delivered this year if the developers will follow the pace of construction. In addition, the construction of another 2,000 units will start in the near future, with delivery terms announced for 2018, according to a market report made by the real estate consultancy company Coldwell Banker Romania.
The absorption rate was maintained during the previous year to over 80% of the units until the delivery of the projects on the market, due to a high level of accessibility to purchase a new home, despite the syncopes registered on the funding segment.
The accessibility Index to purchase a new home conducted by Coldwell Banker Romania, calculated according to the average salary, average prices per square meter and the leu – euro course, reached earlier this year the lowest value in the modern history of the local residential market, the main factors that led to this situation being the exchange rate stability and overall growth in wages.
Thus, in present are required nearly 114 average wages or a period of more than nine and a half years for the purchase of a new apartment with two rooms in Bucharest, compared to 119 salaries one year ago or a period of almost 10 years and 395 average wages or a period of almost 33 years as recorded at the peak of the market in early 2008.
The highest share of the homes that would be completed this year in Bucharest and surroundings fits the mass market segment, ie 59.5% or over 7,200 units, up from the previous year by about six percent.
The main method of getting the mass market segment is represented by The First Home funding, their share being about 75% of the total transactions. The projects falling in this segment come on the market a housing stock affordable in terms of prices, ranging on average between 700 and 950 euros per square meter, the price being the main differentiating factor, followed closely by the location.
Approximately 4,500 units would be completed this year on the residential market in Bucharest and surroundings, or 37% of the offer can be classified as middle market, a segment where the average prices of trading are between 1,100 and 1,300 euros per square meter.
The increase of the number of units targeting the middle class was registered amid the steady income increase of the potential buyers and of the demand for new homes in a better location within the large districts of Bucharest, in semi-central areas, inside the middle ring of the city or near some leading offices poles , like the Barbu Vacarescu – Floreasca area or Politehnica – Grozavesti. Also, on the middle market segment are also framed projects that include thousands of units already completed, which represent integrated concepts that have already formed real communities. Compared with the previous year, the premium segment has a lower weight of the total of the developing units, about 3.5%, or 500 homes.
According to The Coldwell Banker Romania data, approximately 1,800 units located in the medium and large size projects, with over 100 houses were handed over with an average delay of a month or two, not included in the official statistics for the year 2016, when in Bucharest and Ilfov were delivered just over 10,000 homes, according to the National Statistics Institute. The main reasons are the difficult preparation of legal forms on acceptance of works, the connection to the utility networks, the initially announced optimistic deadlines.
In terms of the development zones, the highest percentage of units that would be completed this year in Bucharest and surroundings, of 28.8%, is in the western part of the town, the northern and the south areas each with about 23% of the offer that would be put on the market by the developers, while in the semi-central areas will be delivered about 1,600 apartments (13% of the new offer).
In this context, it is estimated an increase in sale prices by 5% – 7% this year, depending on the market segment and the demand on a particular segment in a certain time.