Real Estate Sales Down, Prices Up

By , 07 Aug 2020, 17:13 PM Business
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STA, 7 August 2020 - Preliminary data by the Surveying and Mapping Authority indicate about a 40% drop in both the number of deals and turnover in real estate in the first half of 2020. Prices of used flats meanwhile continued to grow, by 3% compared to the second half of 2019, taking the average square metre price in the country above EUR 1,900 for the first time.

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The data, released on Friday, show 10,800 transactions were registered in the first six months in a total value of EUR 770 million. This is a 40% drop for both figures compared on the second half of 2019 and a 40% and 45% decline respectively year-on-year.

The Surveying and Mapping Authority said that in the face of an almost complete market freeze during the lockdown, it decided to publish the preliminary data even though a fair part of deals for the first six months had not yet been registered and processed for proper market analysis. Final data will be released in October.

The body estimates that the actual year-on-year decline in the number of deals and in turnover will be between 35% and 40%. It pointed out that 2019 had seen record figures, mostly due to an unusually high number of deals involving commercial real estate.

As for the continuing rise in the prices of used flats - by 3% on the second half of 2019 and by 7% year-on-year - the Surveying and Mapping Authority noted a similar phenomenon had been seen in 2008.

"In such circumstances it is only the better and fairly expensive flats that continue to get sold and their prices are not decreasing yet due to market inertia," the experts wrote, while pointing out that the market picked up again in May as the epidemic was declared over.

Housing property accounted for almost 70% of total turnover in the first half of the year, up significantly on previous years and even above the 66% recorded in 2015. Between January and 15 July, 5,450 transactions were recorded, a 37% decrease on the second half of 2019 and 36% year-on-year. Turnover for new flats was down by more than 70%.

The number of recorded transactions with land suitable for construction on the other hand fell by only a third compared to the first and second half of 2019, while the number of deals involving farm and forest land decreased by about half.

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