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Sharp reduction in construction of real estate

Monday, Jun 08, 2009

Construction of new residential real estate has fallen drastically, according to data released by the National Statistics Institute (NSI), published on June 3.

The data unveils that in the first quarter of 2009, the decrease in construction amounts to 42.8 per cent, as opposed to the fourth quarter of 2008, and is 12.9 per cent lower than the first quarter of 2008.

A total of 3897 new flats in 547 new buildings were developed in Q1 of 2009, the majority of which in Varna and Bourgas, followed by Plovdiv and Sofia. Not a single building was completed in Kyustendil or Stara Zagora, the report says.

"Such a sharp slump was observed in the first quarter of 2009, but the tendency is likely to get worse in the second quarter. I expect the decline to reach 20 per cent as opposed to cumulative figures from last year," said Ivan Boikov, executive director of the construction chamber in Bulgaria. His stance was backed by NSI data, indicating the the pessimistic outlook for the future in the construction sector is only going to deteriorate further.

NSI statistics also show that the average new construction flat has been reduced in size from 78.3 sq m, down to 75.5 sq m.

Source: The Sofia Echo