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Products accessible for high-demand segments have to be sold

Now is the chance to do a successful real-estate acquisition says tIMOn's organizer Vlad Vlasceanu, Managing Director of Admedia Consulta.

Considering the internal and external economic turbulences, how do you perceive the year 2009 in what concerns the real-estate segment? How is this domain affected by the crisis and was the situation currently registered within the real-estate segment expected to occur without the ‘economic situation' that appeared recently?

I will try to answer with a kind of rhetorical question: does it seem to you that anyone gave up on the need for food, security and social status during this period? The real-estate and the residential real-estate sector in Romania in general can be very easily explained through Maslow's hierarchy of needs. We need shelter, security, social status, self-fulfillment. In Romania the demand for houses continues to be much greater than the offer that exists on the market. Most of the Romanians continue to live in small matchboxes dubbed apartments, apartments that are more than 30-40 years old. The current economic situation has brought only one change on the residential market in Romania: the decision has been postponed and the real-estate product has gone through certain transformations, strongly modifying its target audience. We are experiencing the maturing of the real-estate market in Romania, a moment in which the developers understood that they have to ‘build' products that are adequate for the buyers' demand. The much clamored global economic recession has brought one very good thing and two good things for the real-estate market in Romania. The very good thing resulted from the drop in the prices of old apartments, a fact that I had forecasted as early as the autumn of 2007. The two good things stand out on the residential segment: the developers have understood that they also have to build in order to sell real-estate products, so the age of the off-plan is gone, and the second resulted from generating some residential products that are accessible for the medium and economic segments too. While until now the developers were massively selling on the medium-luxury segment and the investment segment, now things have changed and products that are accessible to segments that represent most of the demand have to be sold.

Will there be ‘crisis-prices' for apartments this year?

We cannot talk about ‘crisis prices' but only about prices grounded in reality. The luxury or medium quality finishing has disappeared and the economic finishing has appeared, or the finishing in grey or red. The maximum price of plots of land has been reached and the plots of land on which residential centers had been built are now evaluated at today's market price. That is why the developers have chosen to lower the prices and the profit margins. We have reached the point in which the new houses are cheaper than the ones located in Ceausescu-era blocs of flats, and the age in which the price of a type 2 communist-era bachelor flat stood at EUR 70,000 has set. At this moment the price of new houses has reached the lower limit and now is the chance for whoever wants to make a successful real-estate acquisition. Unfortunately for them, many of the buyers are hesitating and they are unable to understand that the moment in which they could buy a new apartment at a derisory price is will not come. It's as if in the midst of an auto crisis one thinks about reaching the point in which one can buy a Ferrari at the price of a Trabant. The segment of new houses has slowed down its growth (hardly anything new is being built) and tends to exhaust its stocks. The winners will be the speculators that in 2-3 years' time will start to sell at prices comparable to those registered at the end of 2007. One year ago it was unimaginable to be able to buy a new bachelor flat in Bucharest for only EUR 34,000 or a 2-room apartment in Mamaia for just EUR 10,500. Half a year from now these offers will become chimeras for those that properly evaluated their acquisition. Two years from now they will become legend.

How did tIMOn prepare for this new edition and how do you think the clients will respond to the offers presented?

The real-estate and media people have dubbed tIMOn, more than once, the pioneer of real-estate fairs in Romania. For the historical year 2009 we have launched an extremely provoking message: Real-estate Market comeback! In this sense, from March 26 to March 29 we will prove that will happen. First of all we are the only real-estate fair in Romania that has filled 130 per cent of its exhibition space, being forced to find alternative solutions for all of the 50 exhibitors. Secondly we have had an excellent collaboration with the developers present at the fair and we have convinced them how important the customer's expectations are. After 3 months of feelers and market probing the tIMOn exhibitors have understood the importance of offering the buyers exactly what they want: finished houses that target all segments of audience. tIMOn will open with the launching of 7 new residential projects (we are thus continuing the series of premieres within tIMOn), with the promotion of special discount offers that go as high as 40 per cent compared to the February price and with financing solutions that would allow for buying an apartment directly from the developer.

The 2-room apartments in Mamaia at a price of EUR 10,500 or the bachelor flats in Bucharest with prices ranging from EUR 34,000 to EUR 48,000 grab the limelight in what concerns the prices. The 2-room apartments at prices that go up to EUR 80,000 are drawing the interest of young families, while the luxury segment also has its products represented by houses with high-quality finishing or by centers with facilities destined for that segment.

What will be the main points of attraction during this edition of tIMOn? Any future perspectives?

The main point of attraction will be represented by the product per se. For the first time the client will have the possibility of choosing the product that he wants and that he can afford. The offers are so well diversified that you won't be able to say that one can't find a house if one looks for it. The prices are geared to the client's demand and the developers are flexible, so we have truly laid the bases for the real-estate market's powerful comeback. While in the autumn of 2007 I was told that I am crazy for forecasting the collapse of the second-hand market, now I was told that I am even crazier for stating that the sudden change for the better in the real-estate market in Romania will occur during tIMOn. But this is our role, that of contributing to the development of the real-estate market in Romania, of remaining the same useful tool that serves both the buyers and the developers. And the future brings good news: the third edition of tIMOn Constanta will take place this summer in Mamaia and 3 other tIMOn exhibitions will take place this autumn and winter. Then we will talk about a redefined Real-estate Market!

 

Sursa: http://www.nineoclock.ro

Tags: which apartments market developers prices timon price houses romania segments demand accessible estate economic residential segment products

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