Global crisis drives real estate market to 35% decline
11 December 2008
The local real estate market has declined by 35% since January, following a 15% annual increase since 2004, Colliers International consulting company Managing Partner, Bogdan Georgescu, said. ''The depreciation is caused by the global financial crisis, which has sharply affected the local real estate sector, making investors think twice before acquiring a property,'' Georgescu said.
The retail segment has suffered the most, especially in cities outside Bucharest, where numerous malls were announced. However, developers realized that so many malls cannot be supported by the purchasing power.
However, analysts expect the market to revive in 2009. ''The value of real estate properties will not decline significantly next year. It will drop a further 10%, and then begin appreciating,'' Georgescu said.
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