Market in Depth

All major cities saw accelerating house price growth

Lalaine C. Delmendo | January 28, 2022

Romania's house prices are rising rapidly again, amidst the country's strong economic rebound. In November 2021, the average selling price of apartments in Romania soared 14.8% y-o-y (7.56% inflation-adjusted) to €1,551 (US$ 1,764) per square metre (sq. m), a sharp acceleration from an annual growth of 2.35% in November 2020, based on figures from

All major cities in the country saw accelerating house price growth during the year to November 2021:
  • In Bucharest the average selling price of apartments rose by 13.9% (6.7% inflation-adjusted) y-o-y to €1,594 (US$ 1,813) per sq. m, following a miniscule growth of 0.85% during 2020.
  • Brasov saw the biggest y-o-y increase in apartment prices of 17.4% (10% inflation-adjusted) to an average of €1,445 (US$1,643) per sq. m, a strong acceleration from an increase of 4.9% during 2020.
  • In Cluj-Napoca, Romania's fourth most populous city, apartment prices rose by 11.5% (4.4% inflation-adjusted) y-o-y to an average of €2,051 (US$2,333) per sq. m, up from a growth of 7.5% in 2020.
  • In Constanta, the country's oldest city, apartment prices rose by 10.5% (3.5% inflation-adjusted) to €1,384 (US$1,574) per sq. m, sharply up from an increase of 2.5% during 2020.
  • In Timisoara, the average selling price of apartments went up by 6% (-0.7% inflation-adjusted) to €1,364 (US$1,551) per sq. m, following a slight growth of 1.5% in 2020.

“The fact that the local residential market managed to register 12 months of sustained increase in housing prices, in spite of the COVID-19 epidemic, proves that it capitalizes on the population's solid demand,” said real estate intelligence platform Analize Imobiliare.

In Q3 2021, the total number of real estate transactions in Romania soared 31% y-o-y to about 186,000 units, following growth of 11.6% during the whole year of 2020, according to the National Agency for Cadastre and Land Registration (NACLR).

Residential construction is also increasing again. In the first ten months of 2021, the total number of residential building permits in Romania rose strongly by 25.3% from a year earlier to 43,374, according to the National Institute of Statistics (INS) – after falling by 2.9% in 2020 and 0.4% in 2019. Likewise, the area of residential building permits issued increased 14.1% y-o-y to 10.09 million sq. m in Jan-Oct 2021.

Romania house prices
Both the European Commission and the International Monetary Fund (IMF) expect that Romania's economy will grow strongly by 7% this year, fully offsetting the 3.9% decline seen during 2020 amidst the coronavirus pandemic.

There are no restrictions on foreign nationals acquiring dwellings in Romania. Ownership of land is tricky, but companies incorporated in Romania as well as resident foreign nationals and non-resident EU citizens can acquire land.

Analysis of Romania Residential Property Market »

Rental Yields

Moderate to good rental yields in Bucharest, Romania

Houses and apartments are not expensive in Bucharest, with a range of prices varying from around 950 euros per square metre (sq. m.) to 1,950 euros.

How much can you earn? Bucharest´s rental yields are good, at around 6% to 8%.

Please note that our prices primarily represent well-maintained apartments. We have used the "useful area" instead of the "built area" when we computed for the sq. m. prices because we only included old apartments in our survey. When one buys an old apartment in Bucharest, one buys the useful area. But when a developer sells an apartment, he sells the built surface. Therefore, the buyer becomes co-owner of the conjoint spaces.

Currency risk: over the past four years the Romanian Leu has decline slightly against the euro.

Conclusion: Bucharest is a bargain. In only a few European countries are homes less expensive than in Romania. Even more important, Romanian price to rent ratios are very low. Romania is growing rather rapidly, so there is upside potential. But, well, it very much depends whether you want exposure to Romania given that gross rental yields are good, but not extraordinary.

Round trip transaction costs are moderate in Romania. See our Romania transaction costs analysis and our Residential property transaction costs in Romania compared to other countries.

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Taxes and Costs

Rental income tax is moderate

Rental Income: Net rental income earned by nonresidents is taxed at a flat rate of 10%.

Capital Gains: No tax is levied on the capital gains realized by individuals from selling real property; however transfer tax is levied on the transfer of immovable property in Romania.

Inheritance: Inheritance tax is imposed at regressive rates from 2% to 0.50% depending on the value of the inheritance.

Residents: Residents are taxed on their worldwide income at a flat rate of 10%. Residents may deduct personal allowances and allowances for dependents.

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Buying Guide

Buying costs are moderate in Romania

Roundtrip transaction costs, i.e. the total cost of buying and selling a property, are around 7.44% to 16.20% of property value. The greatest cost is the real estate agent’s commission of 6%, half paid by the seller and the other half by the buyer. Stamp duty can reach up to 3%.

Read Buying Guide »

Landlord and Tenant

Romanian law is pro-landlord

Rent: Rents can be freely negotiated. Progressive annual increases can be stipulated in the lease contract.

Tenant Security: The agreement automatically terminates at the end of the contract and no further notice is necessary. The landlord can terminate the lease before the agreed term only if the tenant did not pay rent for three consecutive months and if the tenant did not comply with the contractual provisions.

Read Landlord and Tenant »


Romania’s economy recovering; inflation soaring

In Q3 2021, Romania’s economy grew by 7.4% from a year earlier, following a y-o-y expansion of 13.9% in Q2 and a slight contraction of 0.2% in Q1. As a result, both the European Commission and the International Monetary Fund (IMF) projects Romania’s economy to grow strongly by 7% this year, fully offsetting the 3.9% decline seen during 2020 amidst the coronavirus pandemic.

The economy grew by an annual average of almost 4% from 2011 to 2019.

Romania gdp inflation
Romania’s budget deficit surged to 9.4% of GDP in 2020 – a sharp increase from a shortfall of 4.4% of GDP in 2019 and the biggest deficit in the country’s recent history. The deficit is expected to fall slightly to 8% of GDP this year and to 6.9% in 2022, according to the European Commission. Public debt is projected to increase further to about 49.3% of GDP this year, from 47.4% in 2020 and just 35.3% in 2019.

In October 2021, the seasonally-adjusted unemployment rate was 5.3%, unchanged from a year earlier, according to INS. Inflation soared to 7.94% in October 2021, far from the average of 2.8% in 2010-2020 and the highest level recorded in over a decade.

In the past two years, the Romanian Leu (RON) depreciated again against the euro by 3.5%, reaching an average exchange rate of RON 4.9506 per euro. The recent decline in the currency’s value is mainly attributed to domestic political instability and the continued fears on the global financial markets caused by the pandemic.