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Construction price to rise by 20 pc

ack of labor force and surge of energy, natural gas and oil prices this year will lead to higher prices, of at least 20 percent, in the residential construction field, announced Laurentiu Plosceanu, president of the Romanian Association of Construction Entrepreneurs (ARACO).

ARACO official stressed that a revision of prices will be needed at the end of Q1 because, for the time being, one does not know yet the level of those price hikes for energy, gas and oil. At present, for an average quality residential construction the price ranges around 800 euros per square meters. On the other hand, Lucian Bolcas, administrator of the constructii.ro site, said that the first stage construction price of a residence is of 250 euros per square meter and for at-key delivery of the same residence the prices range around 600 euros per square meters. Constructions market is expected to grow this year by a minimum 35 percent from last year. In November 2007 a growth of 34 percent was reported as against 2006, says ARACO president. Of the overall construction market, this year, approximately 40 percent will be represented by the residential segment, a very important one. 'On this segment we expect a lot of changes. Because the luxury segment is saturated, investors are to focus on the projects addressed to the middle class this year', Laurentiu Plosceanu also said. The prices will be also influenced by the structural funds' accession, maintenance of the attractiveness level for private investors, as well as maintenance of the level of real estate investments. Highest growth in the construction field is expected, as up to now, in Bucharest. After the Capital, locations where the highest number of investments will be concentrated are Moldova zone (Romania north-east) and the big cities, such as Cluj (center), Timisoara (west) and other localities. Given that this is an electoral year, ARACO president estimated that we might assist at an overheating in this sector, namely that the existing construction companies will no longer be able to meet demand and, therefore, they will be forced to expand their technical, technological and human resources capacities. Sursa: http://www.rompress.ro

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