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Romania Real Estate Market Overview
By property | September 3, 2009
Romania Real Estate Market Overview
For the first semester of 2009 Romanian housing market transactions were down by 92%, from 815 million euros for the first half of 2008 to just 62 million euros for the first six months of 2009. At the same time, the commercial property rental market went down by 60%.
The biggest real estate transaction or the year 2009 was made by Dinu Patriciu, a well-known Romanian businessman that took control of the Fabian Investment Fund. The transaction was estimated at 50 million euros.
The Romanian real estate brokers inform that in 2009 rental price indices for type A buildings located in central areas, went down by 10% only, year on year.
We can say that the Romanian housing market crashed in 2009. However, there has been a lot of speculation on the national television regarding the real estate price slump in Romania. In reality, in Bucharest, the prices did not go down except for flats located in the old communist buildings and in certain locations far from central Bucharest. People are afraid to invest due to bad media and due to the new bank polices regarding mortgages. The conditions that ordinary people have to meet in order to take a mortgage or to make an ordinary loan, are very strict and the number of people who qualify for a mortgage decreased considerably. The interest rates are huge compared to other European countries. There is low interest coming from investors from abroad.
The Romanian real estate market is quiet at the present moment. The owners postponed property sale for better times and did not want to drop prices. The buyers tried their best to get a good price, but to their disappointment and surprise the prices were the same as last year. So buyers went quiet, confused by the media, hoping prices will sump in the near future.
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See more properties in: Real Estate, Romania Property | 3 Comments »
Tags: romania real estate, Romania real estate investment, Romania real estate market, Romania real estate transactions, Romanian real estate
December 7th, 2009 at 8:52 am
I’m interested in the real estate market in Constanta, Romania. Any recommendations for where I can find info on average monthly rental rates in the Constanta area…particularly 1, 2, and 3 bedroom apartments?
December 7th, 2009 at 3:09 pm
Hi Mike,
Try : http://www.acordimobiliar.ro . It is also in English.
January 2nd, 2010 at 8:27 am
I live in Romania, so I’m well aware of market conditions here. You’re spot on with the bad media and horrible mortgage rates. There’s no way to get a fixed rate mortgage and the ARM’s average 8% with the EURIBOR at a historic low.
However I’d like to point out some inaccuracies in this article related to Bucharest:
Real estate prices in Bucharest have gone down by 40% on average. This includes buildings located in the center. I just bought a flat in downtown Bucharest with a 40% discount from what it sold for in early 2008.
The decline was indeed more pronounced in communist buildings, but you should mention that over 95% of all buildings here are communist, which gives new meaning to the phrase “prices did not go down except for flats located in the old communist buildings”
I think it’s a good time to buy if you can get financing at a decent rate or have cash on hand.