SIMILAR ARTICLES

How Romania is seen from an EU economic indicators perspective

Eurostatistics is a synthesis based on a set of standardized and harmonized benchmarks for the comparability between countries at the European level (Principal European Economic… Mai mult

Quality of economic growth? Let’s look at resource productivity

Romania climbed last year on the penultimate position among the EU member states in terms of the productivity of resources in the economy, after Bulgaria,… Mai mult

Study: Consumption ghosts – Two-thirds of undercapitalised companies have no revenue

Romania’s economy is becoming more and more vulnerable due to the increasing number of businesses that state no revenues, register losses and debts exceeding their… Mai mult

Labour cost, more than 15% higher than last year

Hourly labour cost increased by 15.6% in the second quarter of 2018 compared to the same period of 2017 (+ 9.36%, compared to Q1 2018),… Mai mult

Fiscal Council, about budget amendment: Increase in revenues from VAT and excise duties has no basis

The Fiscal Council announced on Wednesday, the day when the Government adopted the draft budget amendment without the opinion from CSAT, that it considers the… Mai mult

Romania fulfils again stability requirements (a near-miss) in terms of housing price increase

de Marin Pana , 16.4.2018

According to the revised data published by Eurostat, Romania has fulfilled again (a near-miss) the macro stability requirement set at the European level for the increase in the price of housing.

With an arithmetic mean of 6% for the whole of 2017 and a value declining to 5.6% in the fourth quarter, we were in line with the requirement of no more than 6% increase, year on year, in real estate sector prices.

We remind that our country had reached 13 of the 14 stability criteria met in 2015 (the one regarding the net investment position cannot be achieved given the massive foreign investments made in our country and the quasi-inexistent Romanian investment abroad) and it is already foreseen, as a planned loss, the criterion regarding the labour unit cost increase (it is calculated for a period of three years and has a reference set at 12%, which we can no longer meet following the salary increases decided in 2016 and 2017).

  • We also present developments in other countries from the former socialist bloc, as well as in Germany, France, and the significant averages at the EU level, to see how we position ourselves at this sensitive indicator. It can be seen that we are obviously better than our neighbours Bulgaria and Hungary, and even better than the Czech Republic and two of the three Baltic countries.
    *
  • Evolution of housing prices in 2017
  • Country           Q1       Q2       Q3       Q4       Average
    *

Our model, though, should be Poland, which just follows discreetly but with maximum efficiency, the European trend and had precisely the same value, calculated as an arithmetic mean (values have not been adjusted seasonally, according to Eurostat), as well as the Eurozone.

An area where Germany and France set the tone in this matter, with a trend somewhere below four percent (with the mention that the former was on a declining trend and the second on a growth trend so that their positions exchanged in the last quarter of the year). Estonia also managed to temper its momentum with which it started last year and to keep a reasonable distance from the threshold set.

Noteworthy, calculations have been remade slightly downward for the whole Union compared to those in mid-January this year (respectively, from 4.1% to 4.0% weighted by Eurozone seasonality and from 4.6% to 4.5% for EU 28), as specified by the EU statistical body.

In this European context, especially given the increases in income and inflation at the national level, we should be very cautious with the real estate market prices. Especially that not even are we objectively pushed to the limit of the macroeconomic stability (as it has been established theoretically) but we are also working with housing prices traditionally expressed in euros and we have not adopted the single currency.

But euro stood in the first quarter of the year significantly above the target in the official forecast considered as the basis for the 2018 budget (4.59 lei/euro, revised from 4.56 lei but 4.65 – 4.66 lei as a monthly average in January, February and March), with a marginal growth trend.

Basically, we have here an important factor of economic stability that we should better keep track of more carefully and maintain it under control as much as we can with administrative means that could take on potential outbreaks of the market.

The alternative is that the implications of any potential real estate bubble may not suit us at all.

Mergeți în homepage ›

Publicat la data de 16.4.2018

Lăsați un comentariu


NEWS

Finance Ministry wants to change rules for insolvency: state could also register claims after procedure is launched

Companies’ possibility to avoid paying creditors (and in particular the payment of tax receivables) simply by declaring their insolvency would be drastically limited, according to… Mai mult

Phil Hogan: Swine fever in Romania has an impact on neighbouring countries and EU trade in pigs

Prime Minister Viorica Dancila, European Commissioner Phil Hogan and Agriculture Minister Petre Daea The swine fever epidemics in Romania has an impact on neighbouring countries,… Mai mult

Infrastructure projects lost EUR 41.5 million following budget amendment. In what projects cuts have been made

Despite the assurances that Dancila government is concerned and intensely working on the road infrastructure projects, at the budget amendment the Transport Ministry has cut… Mai mult

European Parliament have decided to adopt in October a resolution on the rule of law in Romania

Leaders of the political groups in the European Parliament have decided to adopt in October a resolution on the rule of law in Romania. The… Mai mult

"Romania's buffers have deteriorated, the country is less prepared for a negative shock" - IMF will reduce economic growth estimate

Romania will be less prepared if the economy is hit by a negative shock, as the structural deficit has been deteriorated - IMF representative for… Mai mult

Premiere: CSAT asks Finance Ministry to amend amendment - session suspended until Government comes with a draft that does not affect budgets of secret services

President Klaus Iohannis suspended on Tuesday the CSAT meeting for discussing the budget amendment, as there was no consensus on the budgets of institutions from… Mai mult

S&P maintains Romania's rating at "BBB-A-3", with a stable outlook: arguments

Rating agency Standard & Poor's confirmed on Friday ratings for long- and short-term debt in foreign and local currency to "BBB-/A-3" with a stable outlook,… Mai mult

"Romania’s presidency seems to fail before it starts": Gunther Krichbaum - reaction to anti-German violent statements made by government officials

Romania's presidency of the Council of the European Union seems to fail even before it starts, warns Chairman of the Bundestag European Affairs Committee Gunther… Mai mult

OMV Petrom sells a quarter of its deposit perimeters to finance potential gas extraction from Black Sea

OMV Petrom (SNP) will sell another 50-60 perimeters from its portfolio of about 200, as most of the company's investments focus on operating the Black… Mai mult

Emigration continues: 220,000 Romanians left the country in 2017

The number of people who left the country for more than 12 months continued to grow last year, reaching almost 220,000 people (which exceeds the… Mai mult

181 magistrates sign a criticizing letter addressed to Minister of Justice

The Minister of Justice stirred up the fury of magistrates. 181 prosecutors and judges sent him a letter criticizing Tudorel Toader for his statements about… Mai mult

Canada takes over air-policing missions operated from Mihail Kogalniceanu base

MApN announced on Wednesday that Mihail Kogalniceanu Air Base 57 had a ceremony occasioned by the handing over of the Enhanced Air Policing between the… Mai mult

Ministry of Finance is drafting a new fiscal framework valid as of January 1, 2019

The Ministry of Public Finance makes a "comparative analysis" of the Tax Code and the Tax Procedure Code with a view to applying a new… Mai mult

Eurostat: Romania and evolution of employee number in public sector in an European context

Romania, Hungary and Slovenia are the member states that recorded the largest increase in the share of public sector employees in the total number of… Mai mult