Is everyone holding his breath on the Hungarian real estate market? - Portfolio.hu Interview

How come there are no transactions on the Hungarian real estate market? Why are the key consequences of the credit crunch? Which types of properties will suffer the most due to this? What should be expected for the second half of the year? These are some of the questions Doug Hardman, Regional Investment Director at DTZ, answered in an interview with Portfolio.hu.

Portfolio.hu: Did you experience an increase in transaction yields as a consequence of the credit crunch?

Doug Hardman: I think this region is a less mature market and it is very interesting to see how Central and Eastern Europe is behaving during the credit crunch compared to more sophisticated markets in Western-Europe, particularly the UK. In London - one of the most dynamic and sophisticated markets in the world - the re-pricing was much quicker and more dramatic than in the CEE markets.

I think we are waiting to see the full outcome of the credit crunch. Probably at the end of Q1 2008 and definitely by the middle of 2008 we will be in a better position to see how the market has changed. I've just talked to some of my colleagues in other CEE markets and they said not many investment transactions were to be closed in this quarter, so I think that a lot of players are waiting to see what will happen.

In reality, I don't believe people take on board re-pricing unless they are forced to. Developers are negotiating, they are waiting to see what is happening and they are not forced to do anything at the moment. The reaction time of this market is relatively long and we should not forget that the Hungarian investment market is much thinner and less transparent than in the more established markets.

Resource: resourceinfo.hu