Between January and November 2024, 33,156 building permits for residential buildings were issued in Romania, marking a 3.3% increase compared to the same period in 2023, according to data from the National Institute of Statistics.

The growth in permits was observed in several development regions, including South-Muntenia and West (+391 permits each), Bucharest-Ilfov (+224), North-East (+99), North-West (+62), South-West Oltenia (+59), and South-East (+6). However, the Center region experienced a decline of 172 permits.

In November 2024, 2,729 permits were issued for residential buildings, reflecting a 13.8% decline compared to October 2024. The total usable area covered by these permits decreased significantly by 35.3%, amounting to 671,217 square meters. Of the total permits issued, 72.3% were for projects in rural areas.

Despite the monthly decrease, November 2024 showed an improvement compared to the same month in 2023, with a 1.1% rise in the number of permits issued and a 6% increase in the total useful area.

The data underscores continued growth in residential construction, particularly in specific regions, while also reflecting seasonal and regional variations in activity.

Source: Profit.ro

Official data provided by the National Agency for Cadastre and Real Estate Publicity (ANCPI) show that in December 2024, 18.7% more homes were sold in the capital than in November, more precisely 5,136 properties, compared to 4,326 units bought in the penultimate month of 2024.

“2024 was a year that offered a lot of investment opportunities for the Bucharest real estate market. The sales of new apartments, houses and villas had significant month-on-month increases, which proves the interest in real estate, both for investors who are buying with the aim of getting attractive returns from rental or resale operations, and for those who want to improve their living comfort,” says Vlad Musteață, CEO of North Bucharest Investments.

Demand for residential properties strengthened in the last month of 2024 and across the country. According to ANCPI, a total of 15,650 homes were traded in Romania. After Bucharest, the top cities with the most sales are Timis with 1,145 units sold, Constanța with 1,009 units, Cluj with 978 and Brasov with 867 homes purchased in December 2024.

“The capital’s modern infrastructure, the positioning of the available properties and the accessibility to famous educational institutions, hospitals, major shopping areas or office centers are important arguments for the rising trend of demand for real estate in Bucharest,” emphasizes Vlad Musteață.

In this context of overall market growth, North Bucharest Investments reported for the month of December 2024 a total of 143 transactions in the Capital, with a cumulative value of EUR 22 million. Compared with November 2024, when 126 transactions were carried out, North Bucharest Investments recorded a monthly increase of 13% at the end of last year.

Rising average incomes outpacing price growth has improved housing affordability in Romania, setting it apart from other Central and Eastern European (CEE) countries such as Poland, the Czech Republic, and Hungary, where prices and rents have experienced significant increases, according to the latest analysis by Colliers. In Bucharest, house prices have increased by approximately 50% over the past five years, while Cluj-Napoca has seen an 80% rise. By comparison, most major cities in the region have reported increases of 80% to 100% during the same period.

“While overall housing affordability in Romania appears favorable, there are notable differences across market segments. New homes in desirable areas are often beyond the reach of average wage earners. When factoring in financing costs, affordability decreases further due to high interest rates. Moreover, the gap between the cost of renting and owning has become increasingly evident, with renting often proving to be the more economical choice. In Bucharest, the average rent represents around 45% of a monthly salary, significantly lower than in other capitals in the region, such as Warsaw or Bratislava, where it approaches 70%. This makes renting a more affordable option than buying, particularly in the context of mortgage rates that far exceed rental costs for similar apartments”, explains Gabriel Blăniță, Director & Advisory Services la Colliers România.

In recent years, the residential rental segment has gained significant traction in Romania. Developers and investors are drawn to the potential for rising property values and the relative affordability of rents, according to Colliers consultants. This trend is further supported by the rapid economic growth of major cities like Bucharest and aligns with recent developments in comparable markets such as Prague and Warsaw.

However, Romania remains one of the countries with the lowest mortgage penetration rates in the European Union – less than 2% of the total housing stock, compared to 15% in Hungary, 14% in Poland, and 26% in the Czech Republic. Limited access to financing has slowed the pace of new housing developments. Nevertheless, investment in the rental sector provides a sustainable, long-term solution to meet housing demand.

“The prospect of rising property prices, combined with the advantages of the rental market, is driving a paradigm shift in the real estate sector. Residential rental projects are becoming increasingly appealing to investors due to their stability and long-term returns. The economic growth of Romania’s major cities, particularly Bucharest, plays a key role in fueling this interest”, adds Gabriel Blăniță.

The residential market in Romania continues to grow steadily, marked by affordability and dynamism despite the challenges facing the CEE-6 region. Investments in the rental sector and the development of mixed-use projects present significant long-term opportunities, further solidifying Romania’s position as an appealing destination for international investors.