The EPS Residential Index includes historic data starting from 2005 until present time.
The EPS Residential Index of Romania repeated a small increase in the second quarter, in a similar manner with the first quarter of 2013, raising the possibility of a temporary positive trend in the national market, although these two sliding quarters could well be caused by a seasonal fluctuation. This appears to steadily continue the small fluctuations around a gently rising price level that has been suggested by the index starting from the middle of 2011.
The various components of the national index vary, demonstrating price rises within some areas, while in other recording declines during the quarter. In the one year period, from the second quarter of 2012, the national price index fell moderately, by -1.5% in average. During the 5 year period, which starts from the peak of the market registered in mid-2008, Romania residential prices have been declining at an average annual rate of -9.2%, totalling a reduction of the price of Romanian homes of -38.3%. Prices in Central Bucharest reduced during the quarter by -4.8%, continuing the similar reductions of the previous quarter. On the other hand, in Bucharest Ring prices rose by 4.4%, achieving stability for a whole year with a marginal fall of -0.7% since the second quarter of 2012. Prices in Ilfov County continued to slide, totalling a -8% reduction during the last four quarters.
Dunare & Sea and Muntenia lead the price increases among the divisions, with rises of 6.5% and 5.2% respectively. Impressively, South, West and Moldova continued recording residential price increases for the second quarter in a row, keeping the lead in year-on-year price rise over other divisions at 4.5%, 2.7% and -0.2% respectively. Moldova remains the national division with the smallest average price drop rate during the last five years, at -5% per annum or a total price reduction of -22.5% since the peak of the market recorded in mid-2008.
Among the larger cities of Romania, Galati and Ploiesti present the highest quarterly growth rates, being most likely affected also by statistical noise, since the year-on-year and five-year performances of those two cities are negative and do not distinguish through special performances within the EPS index cities group. Cluj-Napoca, Iasi and Timisoara, however, hold the leading positions with a combination of quarterly and year-on-year growth, all figures varying within the healthy range between +2.4% and +6.5%. On the top of leading short and medium term performance, Iasi records the best 5 year performance with price decline rate since the peak of the market of -6.2% per annum (totalling a 5 year drop of -27.2%), followed by Galati with an annual drop of -8.4% or a total drop of -35.5%. All the remaining large cities of Romania have recorded steeper 5-year residential price average decline rates.
Apartment prices in Bucharest appear to have underperformed the average; whereas house prices in the Capital seem to lead the price increases of the last quarter. In a similar manner, the lead of houses over apartments is also suggested by the indices at national level, during the last quarter. In Bucharest, the new properties grew at a higher rate than the old ones. At national level, old properties clearly outperformed new units during last quarter, recording price rises versus price losses respectively.
Although the results of the last quarter are mixed, the second quarter rise at the national level may be a sign for crystallising a sustainable growing trend. At the Capital level, the Centre is suffering a correction of the good results registered during 2012, while Bucharest Ring is on a reverse trend minimising the fall of the previous quarters. Overall, Bucharest is still on a decreasing trend compared with 2012; however, there are positive signs that the decrease can be recovered by the end of the year.
Eurobank Property Services S.A. is a subsidiary of Eurobank group. Established in June 2005, as an integrated service centre, the company offers total real estate solutions. Eurobank Property Services has developed a vast network in the Romanian territory, operating from its Head Office in Bucharest. Eurobank Property Services has managed to maintain its competitive position among the top real estate companies in Romania, by developing an important portfolio of customers including banks, with Bancpost being the main client, public institutions, real estate funds, foreign investors, local real estate development companies and private companies.