Tuesday, 5 June 2012

Real estate : Real estate market in Romania continues negative trend

The Romanian real estate market will continue on a negative trend because the economic situation is still turbulent at local and European levels. In the last 6 months the prime minister changed twice, while the local currency reached a historic low level. Even if the situation is not very dramatic, it is a sign that investments will not grow. At European level, Greece, Italy and Spain are in the center of attention, while banks in those countries need capital, specialists consider. In their opinion, banks in Romania do not have funds to finance many real estate loans. Real estate is a forbidden term for most banks in Romania.

Their resources are mainly allocated to problems which have to be solved, or for short term credits for maximum two years. Recipes are not attractive, while desires for residential credits are at the lowers level in the last 3 years. The purchase power continues to be low, while mentalities and the legal frame remain stable, which is a good thing. As for mentality a minority is working and trying to build serious things while the majority continues to look for easy gains, without rules, self respect or have petty values.

The legal frame is untouched: there is need for a new law but politicians are not interested in this matter. However, the retail sector has potential. In case salaries grow in the public sector, the consumer power will also grow significantly. Better days are yet to come if structural problems of the European Union can be solved.

Source: http://actmedia.eu/economic/real-estate-real-estate-market-in-romania-continues-negative-trend/40368

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