Építésaktivitás vizualizálva – Magyarország

A posztot és a tableau viz-t összeállította: Gáspár János, Buildecon

EBI-dataviz-teljes-építési-piac

Korábban írtunk már ezen a blogon is az EBI Építésaktivitási Jelentésről, amikor bemutattuk ezen kutatásunk első eredményeit. A kutatás lényege, hogy egyedi építési projektek adataiból olyan aggregátumokat alakítsunk ki amelyek új, naprakész információt hordoznak az építési piac szegmenseinek aktuális alakulásáról. Most egy következő szintre léptünk.

Röviden a legfontosabbak:

  • A vizualizációval a három mutatószámunkat, (1) Aktivitás-Kezdés, (2) Teljesítmény, (3) Aktivitás-Befejezés, összefüggéseiben mutatjuk meg.
  • Az Aktivitás-Kezdés, hasonlóan az építési engedélyhez, un. előidejű mutatószám, azaz rövidtávú előrejelző képessége van. Az Aktivitás-Kezdés alakulása meghatározza, hogyan fog a Teljesítmény és az Aktivitás-Befejezés alakulni.
  • Az építési piac minden szegmensére látható, hogy milyen értékben indultak el kivitelezési munkák, hogy ez milyen Teljesítmény és milyen befejezési értéket eredményez. A legürdülő menük segítségével több részpiac, illetve több szegmens egyszerre is vizsgálható.
  • Érdemes teljes képernyős módban nézni, a jobb alsó sarokban lévő  ikonra kattintva tud erre a nézetre váltani.
  • 2018 3. negyedévről készült jelentés mögötti adatokat jelenítettük meg. Az azóta eltelt negyedévekről folyamatosan frissítettük a vizualizációt. Ha érdekli a legfrissebb, 2019 1. negyedéve, vagy bármilyen kérdése van, kérem írjon nekünk: ebi@ibuild.info.
  • Az alapadatok, vagyis az egyedi építési projektek forrása az ibuild.info, a mutatókat és az aggregálás módszertanát az ELTINGA és a Buildecon közösen dolgozta ki.

Mixed Feelings on the Romanian residential market

Written by Dr. Sebastian Sipos-Gug – Ebuild srl, EECFA Romania

Romanian snowglobe
Source: https://sofiaadventures.com/romanian-souvenirs/

Revisiting the Romanian residential construction market

We previously looked at the stability of the Romanian residential construction market and the likelihood of a correction even in the scale of the 2008 one. A lot has happened in the year since our previous post and we see ourselves faced with a similar question regarding the future of the residential construction, albeit now of a substantially different one. Previously, the main threat to market equilibrium used to be the oversupply due to speculative development. Now, we are faced with the distinct probability of a drop in demand.

Emergency Government Ordinance no. 114/2018 (EGO 114)

Residential construction was quite active in 2018, and our previous analysis indicated that despite significant growth in the past years, the market could be considered relatively stable. This has changed dramatically due to government intervention at the end of the year through Emergency Government Ordinance no. 114/2018 (EGO 114).

There are a number of features of this legislative paper directly and indirectly impacting residential construction: changing the minimum wage for construction workers, tax breaks for construction companies, changing the taxation of telecom and energy companies, and a new tax on bank assets.

Construction

Starting with 1st January 2019, the minimum wage for construction workers has been raised to RON 3000, up from RON 1900 previously, and higher than the RON 2080 value for the rest of the economy. The government also included in the Ordinance a tax break for these wages, exempt from income and health taxes, yielding a much better net to gross ratio for employees. However, the total impact on salary costs for companies remains significant. According to Continue reading Mixed Feelings on the Romanian residential market

EECFA 2018 Winter Construction Forecast

EECFA (Eastern European Construction Forecasting Association), conducting research on the construction markets of 8 Eastern-European countries, released its 2018 Winter Construction Forecast Reports on 5 December 2018. Key findings are summarized below. Full reports can be purchased, and a sample report can be viewed at www.eecfa.com.

In many previous forecast rounds we have argued for a soft-landing scenario in Turkey. However, the dramatic fashion of the currency depreciation in summer 2018 unearthed many structural problems of the construction industry and made us revise our forecast to an even more pessimistic one. Unlike the stop-and-go like reactions to previous crises, we tend to believe in a stop-and-stay scenario this time. In Russia, we are less pessimistic thanks to a recently announced governmental program expected to affect the market positively.

EECFA-EE3

Optimism still prevails in the Eastern and Western Balkan countries of EECFA. For the region as a whole the new forecast sees just a little downward revision. However, on country level, the stories are different. Less optimism in Croatia and more optimism in Serbia and Slovenia compared to the previous forecast round. In Romania, the largest construction market of this region, the outlook of the building construction submarket has been adjusted downward.

EECFA-SEE5

Bulgaria. Construction output in Bulgaria is speeding up with an expected growth of 7.4% in 2018. Residential construction continues to expand on the back of increases in economic activity and real disposable income, and historically low interest rates on housing loans. Additionally, the non-residential segment is also predicted to grow driven mainly by office and industrial constructions. Civil engineering construction has continued its recovery path in 2018, Continue reading EECFA 2018 Winter Construction Forecast

Growing too fast? The stability of the Romanian residential construction market

As the housing market in Romania is seeing a rapid expansion, this rings the bell to some experts: there is a growing concern that the 2008 turmoil might repeat itself. Can the 2008 crunch be back in the Romanian housing market? This article is looking at the probabilities of this to happen.

Written by Dr. Sebastian Sipos-Gug – Ebuild srl, EECFA Romania

High-end residential project, Herastrau, North of Bucharest, Romania. Source: http://www.ascendproperty.ro

For almost a year now, concerns have risen regarding the Romanian residential market. Any instabilities in this field would have major implications across the whole construction sector, since residential construction accounted for approximately 1/3 of the yearly construction output of Romania in 2016.

Opinions emerged regarding the similarities between the 2007 and 2017 market dynamics, and reports by the National Bank (BNR), National Statistics Institute (NSI) and real estate agencies indicated unusually high growth rates of residential prices.

So, how likely is a correction event?

To answer this, we must look at the idiosyncrasies of the Romanian construction market, the similarities and differences between the collapse in 2008 and the current status.

The residential construction market in Romania is a mix between large projects, run by speculative developers, small projects contracted to construction companies and projects built by the owner.

Romanians are generally home owners, with 96% living in a house they own. They are also very fond of building homes themselves, mainly in the rural areas. This trend of self-development, mainly in the rural areas, is relatively untouched by macro-economic phenomena. Any disposable income is invested into construction materials that are used to build up or expand the home, leading to very low construction costs.

The main source of instability, however, is that of speculative urban (or suburban) development. With profit margins boosted by the real estate price increases and high demand, investments into residential construction are attractive. This has been evident in the years leading to 2008, as the number of homes in multi-unit buildings completed in 2008 was nearly three times that of the previous year, and the number of permits for this building type doubled yearly between 2006 and 2008.

The current status of the market is optimistic. Two-digit growth rates are estimated for 2016 and 2017, with EECFA’s forecast being positive until at least 2019 (the latest EECFA Romania Forecast Report can be purchased here).

Those who express concerns regarding these growth rates look at the similar results of 2006-2008 and expect another collapse of the market to take place. Other concerns are that much of recent growth has been backed by government subsidies. Under the ’Prima Casa’ Program, the mortgage market has considerably grown since 2010. Continue reading Growing too fast? The stability of the Romanian residential construction market

EECFA 2017 Winter Construction Forecast and Revision

EECFA (Eastern European Construction Forecasting Association) – the forecasting association conducting research on the construction markets of 8 Eastern-European countries – published its 2017 Winter Construction Forecast Reports on 4 December. A concise summary on the main findings is outlined in this article. Please consider that foreseen development stories are rather different for the 3 submarkets (residential, non-residential, civil engineering) of construction in the countries we cover. In Russia, for example, civil engineering is expected to drive the total market back to expansion. Unless you need only an impression about the total market, we kindly suggest consulting with our reports.

Construction outlook up to 2019 in South East Europe: the countries EECFA dubs ‘South East Europe-5’ are Bulgaria, Croatia, Romania, Serbia and Slovenia. The overall picture is still very optimistic, but the expansion rate of the total construction market has been revised a bit downward, mostly due to the worsened expectation in EU fund absorption on the forecast horizon. This affects largely the civil engineering submarket, where 9% cumulated growth is foreseen for 2018-2019 for the region as a whole. In a very favorable macro environment where money is cheap, building construction is set to continue to recover; with a 17% cumulated market growth predicted for the upcoming 2 years. Shortage of skilled labour in construction is a major constraint of a more rapid growth, though.

Bulgaria: the country is facing a 7% growth in total construction output in 2017 as EU funds of the new cycle are fuelling civil engineering construction which dragged down the whole sector in 2016. Thus, total construction output comes from a very low level; in 2016 it nosedived by 35.2% (compared to the forecasted 31.1%). In 2018, the construction sector is set to register a 5.6% increase (as opposed to the 6.4% forecasted earlier), while 2019 should bring a 5.7% rise (up from the +4.5% predicted formerly).

Croatia: the good news for construction growth in Croatia is the country’s increasing capacity to obtain EU funds, at which the current government seems to be getting better and better. Continued strong growth in GDP, private consumption, retail turnover and industrial production should also benefit construction. Total construction output growth is estimated to be 6.3% for 2017, which has been revised down from the 11.2% growth expected in summer due primarily to caution shown by buyers, bankers and developers in the residential segment and to delays in some government-led, civil-engineering projects. Continue reading EECFA 2017 Winter Construction Forecast and Revision

Serbia’s retail – primed for take off

Serbia’s retail segment is enjoying a robust growth in the number of permitted buildings due to the permit reform introduced in 2015. With the first phase of the reform having commenced in 2015, and the second phase having been set out in 2016, the application procedure for permits has been made fully electronic in order to have full transparency. Consequently, not only did Serbia gain a better position in The World Bank’s 2016 Doing Business list, but is now seeing a new investment cycle of the construction of high-volume international-type shopping malls. The start of such several big-league projects should sustain this growth cycle and give a boost to construction volumes in the years to come.

Written by Dejan Krajinović, Beobuild Core D.O.O, EECFA Serbia

Delta Planet, Ada Mall (top row), IPM center, BIG Fashion (middle row), BW Gallery (bottom) – Source: beobuild.rs

In an effort to improve investment climate, permit procedures in Serbia were marked as a one of the main regulatory obstacles to development, with a long line of inefficient procedures and corrupt instances suffocating the economy. Before the reform was introduced, in some cases, it took almost a year to acquire a building permit, even if all legal conditions were met. During 2015, the government presented a multi-phase reform, which would include a total overhaul of the procedures, resulting in far cheaper and much faster permit procedures. Its implementation started in late 2015 and so far, it has been a resounding success, with building permit applications now being processed in just a few days. Furthermore, the second phase of the reform implementation started in January 2016, with building permit applications now a fully electronic system in Serbia. With electronic and centralized applications, the reform aims to lower the number of instances and the possibility of corruption and hush money in the process. This significant regulatory reform helped Serbia swiftly boost its ranks in the World Bank’s ‘Doing Business’ list, and from 91st in 2015 it reached 47th position in 2016, making it one of the most improving economies of the world in 2016.

With some anticipation of investors, new permit procedures resulted in a strong spike of permit numbers across the board. Practically all construction segments have seen their share of growth, but with almost two years into implementation of the new permit laws, some construction sectors are leading the way. It seems that the retail segment forwards as main beneficiary in building construction, with a very potent investment cycle carrying almost 1 million permitted square meters in just over two years. Coming from a very low post-crisis level, this several-fold increase of permitted retail buildings created a real sector’s boom. The reasons behind such a strong reaction of investors lay in a very opportunistic market, open for development of big city malls and retail parks. It is worth Continue reading Serbia’s retail – primed for take off

Housing market in Russia: Demand potential shaping future market dynamics

While in the EECFA Forecast Report Russia we estimate/forecast residential output, this article is looking at another angle of predicting housing market developments: demand potential in the Russian housing market (the number of households able to buy housing) as the main indicator of further market dynamics. Positive macroeconomic indicators in Russia currently are suggesting growth in real incomes and an increase in the population’s solvency, which in the near-term future is set to raise the number of households able to buy housing. This growth in demand potential will have a positive impact on residential output, yet, this is not something that will happen overnight: the Russian housing market is predicted to continue to slump for the time being. Nevertheless, the predicted growth in demand potential will play a major role in halting this drop, leading to an expansion in the housing market in 2019.

Written by Andrey Vakulenko – MACON Realty Group, EECFA Russia

‘North Valley’ Residential Complex in St. Petersburg – Source: http://www.severdol.ru

Having the largest share in total construction both in value and volume terms, the housing market is the engine of the whole Russian construction market. Any change – decline or growth – in the housing subsector may have a decisive effect on the Russian construction industry as a whole; as it was the case, in particular, during the crisis of the Russian economy in 2015-2016. In this period, the housing sector enjoyed an unprecedented level of state support (more details in the current/previous EECFA reports), which prevented the entire construction industry from collapsing.

The state of the housing market primarily depends on the ability of the population to purchase housing. Other market factors, such as the volume of supply in the market, the level of competition or the cost of housing are secondary. It is the ability of citizens to buy housing that ultimately determines the total volume of effective demand, which in turn regulates development activity and price trends in the local housing market. At the same time, the indicators of the population’s need for housing are also secondary in terms of the dynamics of the market situation; they are of an abstract nature and cannot be used to predict the situation in the market. The need for housing is a conditional market potential, which, without the ability to buy housing is never realized. The ability of the population to purchase housing is the real market potential, which – in most cases – is realized in transactions. The level of housing provision (need) affects only the nature of demand: investment purchase, purchase of a first home, improvement of housing conditions, among others. Continue reading Housing market in Russia: Demand potential shaping future market dynamics

Dealing with construction permits in Bulgaria, Hungary, Romania

The World Bank has prepared its first Subnational Doing Business report on Bulgaria, Hungary and Romania entitled Doing Business in the European Union 2017: Bulgaria, Hungary and Romania. The report is based on the surveys conducted last year by involving respondents from 6 cities in Bulgaria, 7 cities in Hungary and 9 cities in Romania, measuring 5 indicators: starting a business, dealing with construction permits, getting electricity, registering property and enforcing contracts.

Source of table: World Bank. 2017. Doing Business in the European Union 2017: Bulgaria, Hungary and Romania. Washington, DC: World Bank. License: Creative Commons Attribution CC BY 3.0 IGO.

In this subnational research in Hungary, Ebuild Hungary (the parent company of Ebuild Romania, EECFA’ s Romanian member) was responsible for choosing the respondents from the private sector in Hungary on 2 of the 5 Doing Business indicators: dealing with construction permits and getting electricity. EECFA Research, Buildecon, was responsible for coordinating the project on these 2 indicators in the private sector in Hungary. Buildecon also completes the World Bank’s National Doing Business survey on dealing with construction permits in Hungary every year; a survey regarded as a benchmark for investors.

Here we are going to take a look at the key findings on the dealing with construction permits indicator* in Bulgaria, Hungary and Romania, what regional variations are, how the processes could be improved according to the report, why Germany is so efficient in getting building permits and how Hungary is trying to follow suit.

Key findings on getting construction permits

It has been concluded that overall, it is in Hungary where it is the easiest to obtain a construction permit for a warehouse (18 procedures) compared to Bulgaria (19 procedures) and Romania (26 procedures). However, all countries are lagging behind the EU average of 13 procedures.

In terms of the length of the permitting process, it is in Bulgaria where the process is the quickest: on average 141 days, and it is in Romania where it takes the longest time: 256 days. In Hungary it is 164 days, though it is better than the relative EU average of 169 days. There are 2 EU member states, the Slovak Republic and Cyprus, where the process is very long – 286 days and 507 days, respectively.

As far as costs of the construction permit are concerned, it is in Hungary where it is the cheapest to get a permit (0.5% of the warehouse value) and it is in Romania where it is the most expensive (3.4%). Bulgaria is only slightly cheaper (3.2%). By comparison, the EU average is 2.0%.

All three countries have been found to make building regulations available online and clearly specify the requirements for a building permit. Also, it has been concluded that all three countries have strong building quality control mechanisms and strict qualification requirements for professionals responsible for permitting approvals.

On the other hand, in comparison with the EU, the report has found that in all three countries the construction permit procedure is much more burdensome than in most other EU member states. Continue reading Dealing with construction permits in Bulgaria, Hungary, Romania

Game of Towers – Sofia’s New Dynamics in Office Construction

Demand for offices in Sofia is boosting a huge activity in office building and mixed-use projects, and growing land prices trigger the construction of higher and higher such buildings and office towers. The game of towers has generated a public debate on whether to designate zones where these buildings are to be concentrated.

Written by Yasen Georgiev and Dragomir Belchev, EPI – EECFA Bulgaria

BLU Offices, City Tower, Millenium Center (upper row), Capital Fort (lower row). Sources: http://www.novinite.bg, http://www.blu-offices.com, http://www.capitalfort.com, http://www.icon-bulgaria.com

In 2016 the Bulgarian economy registered a growth of 3.4%, driven mainly by increasing household consumption and export volumes. Forecast for 2017 and 2018 suggests that the country’s GDP will register a further expansion between 3% and 3.5%, reflecting the positive signs from the labor market and their implications on individual demand.

These trends support EECFA’s latest summer forecast for an increase in the overall construction market by more than 5% in 2017 and over 3% in 2018. Building construction is set to grow even at a higher pace, thus reaching an annual increase of around 8% for 2017-2019. Beside the accelerated growth of residential construction, it is the non-residential sub-sector that shows increased dynamics after a year of negative growth.

According to the EECFA 2017 Bulgaria summer report, office construction is expected to rise and reach an average growth of 4.7% over the 2017-2019 period. This forecast is supported not only by the announcement of a number of projects due to start in 2017-2018, but also by the increase in permitted floor spaces of office and administrative buildings in 2016 on an annual basis, as well as by the scale of started projects in Q12017 compared to Q12016.

In this regard, Sofia remains the most economically active city in the country. Despite the emerging demand for contemporary office space in secondary cities, in terms of floor space, 77% of all permitted office and administrative buildings in 2016 are located in the capital city, similarly to the share of started office and administrative buildings in Sofia, in a nationwide comparison accounting for 74%.

What stands behind is demand coming from outsourcing and IT companies that either seek to expand or to offer more appealing office facilities to their employees Continue reading Game of Towers – Sofia’s New Dynamics in Office Construction

GDP revision in Turkey: implications on construction market size

TUIK (Turkish Statistical Institute) had been working on harmonizing its GDP calculation method with the most recent international standards from 2013 on. The first revised figures were published at the end of 2016. After the revision, the construction market size was measured twice as large for 2015 as it was considered earlier.

This presentation is about the revised construction size and EECFA’s opinion: Turkey’s GDP and Construction Investment

Prepared by Janos Gaspar (EECFA Research)