NBR keeps an eye on skyrocketing property prices

The real estate market might show signs of overvaluation. This is the message implied by NBR Governor Mugur Isarescu. The central bank”s top man stated that the institution he runs would conduct a survey of the trend of the prices on this market. “It is only natural for the property market to see an increase because we have a very small starting base and the prices were very low. There are risks, however, such as a too sharp rate of growth of the real estate prices,” Isarescu stated. He added the speed of the growth of the real estate had to be considered against the economic and financial situation, implying that the real estate market development was going too fast compared with the overall economic situation. The Governor went on to say that the NBR would conduct a survey to see whether the real estate market was overpriced. Once published, such a survey would be a first time, as it would be the only real estate survey put together by a credible institution. Reading between the lines, the statements of the NBR Governor show concern for a market where prices are going up with little regard for the economic reality. Isarescu”s message comes at a time when the analysts of the European Central Bank, the institution that monitors inflation and stability in the eurozone, concluded that the real estate market in the Union is overheated. ZF