The demand for housing in major cities such as Bucharest, Cluj-Napoca, Timisoara, Iasi, Sibiu or Constanta will remain high this year, so developers will continue to invest in building blocks, and prices will follow the same moderate growth trend seen in 2018, according to a report drafted by real estate consultancy firm Frames and quoted by Profit.ro.
Against this backdrop, developers are unlikely to reduce prices, the report reasoned. On the contrary, a stronger euro, higher financial cost, rising prices for construction materials and costlier labor force will likely increase prices “by a few percentage points,” but at a much slower pace than in recent years, the report concluded.
"Romania is subject to geographic polarisation more and more, from an economic point of view. Labour force migration from rural to urban areas has significantly increased the demand for housing, as authorities are delaying to take the necessary measures to alleviate regional disparities. Lack of investments in poor counties, low wages in urban areas compared to those in the urban areas and poor infrastructure will continue to cause Romanians to move to the city, particularly as the migration to Western countries is no longer as vigorous as in previous years," the analysts said.
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