Romanian Real Estate Firms Anticipate Reduced Market Activity In 2023.
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Loading... - Estrada Eugenio
- 02 Jun 2023
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Most Romanian real estate companies hold a pessimistic view regarding the overall activity in the local market for 2023, according to global consultancy Deloitte. In its recently published Real Estate Confidence Survey for Central Europe 2023, Deloitte sampled real estate developers, investors, and advisers from Poland, the Czech Republic, and Romania. The survey indicates that 63% of Romanian companies expect a decrease in market activity, while 23% anticipate no change, and 14% expect an increase.
In terms of investment volume, half of Romanian real estate companies expect a decrease, 32% expect it to remain the same, and only 18% anticipate an increase. At the group level, 57% of respondents across Central Europe anticipate a decrease in market activity, 28% expect it to remain the same, and 15% forecast an increase.
Alexandra Smedoiu, Partner at Deloitte Romania, stated, "[...] in the current context, the results of the study indicate a balanced position of the real estate players, characterized by caution and consolidation of market activities in the countries in which they operate."
The survey reveals that Romanian companies are the most pessimistic in the region regarding expectations for overall market activity in their country. Only 50% of Polish respondents and 54% of Czech respondents project a decrease.
Regarding average yields, the outlook is more optimistic, with 45% of Romanian respondents expecting an increase, while only 10% anticipate yields to remain the same.
The survey also highlights that 54% of Romanian real estate companies expect an increase in the availability of investment products, 27% estimate it will remain the same, and 18% anticipate a decrease.
In terms of the economic climate in Romania for 2023, 54% of local respondents believe it will deteriorate, 32% think it will remain the same, and only 15% believe it will improve.
Romanian respondents are the most pessimistic about the availability of debt financing for 2023, with 73% expecting a decrease, 23% estimating it will remain the same, and only 4% predicting an increase. Additionally, the tax climate in Romania in 2023 is seen as deteriorating, with 64% of respondents having negative expectations and 36% not anticipating any changes.
At the group level, 61% of respondents from all three countries believe that the Russian military aggression against Ukraine will have medium-term effects, compared to 39% in Deloitte's previous survey conducted in April 2022. Only 7% of respondents expect short-term effects, while 32% anticipate long-term consequences.
