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Break in market of real estate deals

Operators keep saying that the year 2008 brought some elements in the real estate market inhibiting the appetite for investments and purchases.

The reasons are fiscal, investment, and subjective in kind. The introduction of VAT for developers-natural persons who have incomes repetitive in nature and renouncing the reverse tax in the building sector have led to abstention from new investment and recalculations, which triggered a rise in the prices of new dwellings. Gabriel Zamfir, an MP and head of the National Real Estate Union (UNIM), said that because of VAT, some investors-natural persons raise 19 percent the price of dwellings, some others preferred a stand-by, halting sales. The new crediting policy of Romania's Central Bank adds to the fiscal constraints. More and more commercial banks do no longer want to give real estate credits for apartments in old buildings. This substantially reduces the number of potential buyers of old apartments. The toughening of the internal cautiousness norms of banks and successive rises in the reference interest have made of the real estate/mortgage credit a very expensive product. If we add the hard currency factor to that, in other words the depreciation of the Romanian RON currency vs. the euro, it is easy to conclude that is no good period for real estate shopping. Gabriel Zamfir believes the current period in the real estate market is not so much a real blockage, it is rather a period of wait. 'I believe we enter normalcy, and the break in the real estate deals is a moment prior to what is going to become the sector of house business' Zamfir said. Sursa: http://www.rompress.ro

Tags: estate market euro

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