As 2025 unfolds, the Romanian residential market is witnessing a series of trends that could significantly shape its trajectory throughout the year. Insights from the real estate sector, particularly from Imobiliare.ro and Imobiliare.ro Finance, indicate that these trends are emerging alongside developments in the lending sector, which plays a crucial role in property ownership as many Romanians rely on bank financing to become homeowners.
Nationally, apartment prices surged by 13% in 2024, with some major cities experiencing even higher increases. For instance, in Brașov, prices skyrocketed by 20%. According to the Imobiliare.ro Index, property prices continued to rise in early 2025, showing a 4% increase in asking prices compared to the end of 2024. This trend is expected to persist, especially in major urban centers where demand remains robust. However, experts predict that the pace of growth will moderate, as the steep increases seen in 2024 are not sustainable in the long term.
“In large cities, where demand remains high, we will continue to see price increases, but at a more moderate pace, as the strong advance from 2024 is not sustainable in the long term. Additionally, the uncertain context contributes to a tempering of buyer enthusiasm. But this is precisely the period where we may find opportunities for purchase,” stated Daniel Crainic, marketing director at Imobiliare.ro.
The rental segment is also poised to become increasingly attractive. With rising property prices, there is a growing interest from developers in build-to-rent projects. This resurgence in the rental market comes after a period where yields for landlords had diminished. Despite this, rents have increased at a slower pace than property sale prices. For example, rents for two-room apartments, the most sought-after properties among tenants, have risen by 5%-11% in major cities over the past year, according to the latest data from Imobiliare.ro.
As the housing market evolves, uncertainties stemming from the presidential elections at the end of last year have left their mark on the residential landscape. While this could be a good time to identify opportunities, some potential buyers are opting to wait until the election results are finalized. A scenario could unfold where the outcomes of the elections restore calm, both politically and socially, thereby generating a renewed wave of interest among buyers, including those who are usually more cautious. This would inevitably lead to increased competition in the market for the best homes at the most favorable prices.
Looking ahead, the IRCC index is anticipated to decrease starting in April 2025. The key interest rate was lowered from 7% to 6.5% in the summer of 2024, which has allowed Romanians interested in mortgage loans in 2025 to benefit from a reduced IRCC, dropping from 5.99% to 5.66% at the beginning of this year. A further reduction to 5.55% is expected from early April.
Fixed interest rates have also been declining, making standard mortgage loans more appealing than the government program Noua Casă. Last February, the best fixed interest rate available was 5.75%, but by the end of last month, it had dropped to 4.79%. These offers are designed for the purchase of modern homes and come with a series of eligibility criteria that applicants must meet to secure a loan.
Despite a decline in sales, the potential for credit growth remains strong. In January 2025, approximately 30,800 houses, land plots, and apartments were sold in Romania, which is about 6,400 fewer than during the same period last year. Of this total, 8,400 were individual units, marking a 17% decrease compared to January 2024, according to the National Agency for Cadastre and Real Estate Advertising. However, the number of mortgages has remained relatively stable, even showing a slight increase despite the drop in transactions, indicating a positive trend in the proportion of credit in real estate purchases at the start of the year.
There is also a growing interest among Romanians in new homes, particularly in major cities. Approximately 66% of respondents in a recent study by Imobiliare.ro and Unlock Market Research expressed interest in homes completed after the year 2000 or those that are newly finished or still under construction. This trend reflects a shift in buyer behavior, as consumers are now more informed than before and prefer to live in modern spaces that offer increased comfort and reduced maintenance costs.
However, new residential offerings may see further declines due to administrative blockages. The construction sector is affected by the removal of employee benefits and a shortage of skilled labor. The lack of predictability remains a significant obstacle for developers, who typically require an average of 2-3 years to complete a residential complex from the time they obtain construction permits.
Interestingly, Romanians are now more willing to work with real estate agents than in the past. According to a recent market study by Imobiliare.ro, 74% of those who had a real estate need in 2024 opted to use an agency, compared to just 62% the previous year. This growing reliance on professionals indicates a shift in market dynamics as buyers seek expertise in navigating the increasingly complex landscape.
As the year progresses, the Romanian residential market will continue to evolve, influenced by economic factors, buyer behavior, and political developments. With rising prices, shifting rental dynamics, and a growing preference for new homes, both buyers and investors will need to stay informed and adaptable to seize opportunities in this changing environment.
