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After eight years of a slump in the real estate sector, there have been signs of a turnaround in recent months.

According to first-quarter statistics, two trends have become prominent. In the center of the country, where demand is highest, the building sector has experienced a recovery, and some developers, in face of rising demand, have even dared to increase their prices.

However, far from the center, where demand has not picked up, contractors are still struggling. Many believe that the situation is unlikely to improve in the near future, since the government has recently restricted eligibility for state subsidies in home buying.

The commercial sector also is showing mixed signs of returning to growth. In the first few months of the year, commercial real estate, including shopping malls, has improved and rental prices have risen. However, the level of commercial rentals still is far lower than that during the peak period of the 1990s.

There still is a surplus of office space, which has helped maintain the sector's lower prices. Some market analysts believe that despite the lengthy slump, the bottom has yet to be reached and rents may fall even further.

"The slump in the real estate sector has not yet come to a halt," said Aliza Sharon, an accountant who works as an auditor and consultant for many private and public companies in the sector. "All the declarations of a sector recovery come from interested parties in the government and among contractors who want to influence public expectations to encourage demand, to ease a choking credit, and to reassure creditors."