Romanian house prices rose 3.07% y-o-y in 2018

The average selling price of apartments in Romania rose by a modest 3.07% during 2018, a sharp slowdown from y-o-y rises of 7.3% in 2017, 11.01% in 2016, and 7.74% in 2015, amidst slowing demand. In a quarterly basis, Romanian house prices rose by 1% during the latest quarter.

House price growth averaged 8.7% annually from 2015 to 2017. Romania's strong performance over the past three years is a rebound from previous dramatic falls. House prices plunged by 24.22% in 2009, 22.08% in 2010, 6.99% in 2011, 5.96% in 2012, 10.43% in 2013, and 1.59% in 2014. It was only in 2015 that the housing market began to recover. 

Demand weakening, but construction continues to rise

In Q3 2018, the demand for residential dwellings (which include both houses and apartments) in Romania’s largest regional centres fell by 2% from a year earlier, according to real estate intelligence platform Analize Imobiliare. On the other hand, residential construction activity remains strong. In 2018, the number and area of residential building permits in Romania rose by 2.6% and 9.5%, respectively, according to the National Institute of Statistics (INS). 

Rents, rental yields: good yields at 6.07%

Bucharest apartment costs are low, at around €1,591 per sq. m.

Romania: typical city centre apartment buying price, monthly rent (120 sq. m)
  Buying price Rate per month Yield
Bucharest € 190,920 € 966 6.07%

Recent news: Romania’s economic growth remains robust in 2018, but decelerated sharply from the previous year’s record growth, as the effect of the tax breaks and wage increases started to fade. In 2018, the economy grew by about 3.6% in 2018 from a year earlier, from annual growth rates of 7.3% in 2017 and 4.8% in 2016, according to the European Commission (EC). The economy is expected to expand by about 3.8% this year.