Speculators sell uncompleted apartments

Some of the investors (natural and legal persons) that bought new apartments in very early stages of development are selling them before they are completed, at a stage where they have not been fully paid for. One of these investors has 27 flats for sale, in Asmita Gardens, Rose Garden, Platinum Towers, Residenz and Quadra Place (the only finalised complex is Quadra Place). “A Spanish company bought these apartments, avoiding the value added tax. They plan to sell them either to other investors, or to sell or rent them one by one to natural persons,” said Larisa Coman, a real estate broker at Expert Grup real estate agency. Beside these apartments, the company is also selling another 80 flats in new developments, from the portfolio of two investors, from Lithuania and Greece. For the flats in Quadra Place, studios with usable areas of 42 square metres, investors are asking 107,000 euros, VAT included, whereas these apartments were selling for 50,000 euros plus VAT (in the autumn of 2006 when construction started), if they were bought by natural persons. The flats from the other projects will be delivered between May 2008-July 2009, which means they have not been fully paid for. The 27 apartments included in the Spanish investors’ portfolio are assessed at 3.4 million euros, with 2.5 million euros to go to the investors and the rest accounting for residual payments. According to real estate consultants, about half of the new apartments sold on the local market from the early development stages are owned by investors that intend either to resell them for significant profits or to rent them.