Ultra-premium properties in north Bucharest have reached record prices per square meter, according to an analysis by real estate consultancy firm Imoteca. The current average price of EUR 4,170/sqm has never been recorded before, not even in the real estate boom years before the financial crisis.
47 percent of ultra-premium homes now cost over EUR 4,000/sqm, and some even exceed EUR 7,000/sqm.
Fine living (luxury) properties became increasingly popular between 2012 and 2016 as demand for these types of properties grew every year. Their biggest advantage is usually the location, as most are in north Bucharest, in areas like Herastrau-Soseaua Nordului, Pipera, Baneasa, Primaverii, Aviatorilor, Floreasca, Kiseleff and Dorobanti.
“Even though the real estate market was coming out of a decline in terms of prices, this did not slow down the construction of ultra-premium homes. On the contrary, they had a volume increase each year. Because these properties are special, they don’t lose value over time, as they are located in areas where there isn’t too much land left for new construction. Therefore, this type of home is like gold for investors or for those who want to make sure their property is valuable in the future. These are areas where properties simply do not devalue,” the analysis shows.
In 2019, luxury homes have reached a peak in terms of their price per square meter. 35 percent of them cost between EUR 4,000 and EUR 4,400/sqm, while 11.5 percent are between EUR 5,300/sqm and EUR 5,609/sqm.
The lowest prices for luxury properties are above EUR 3,000/sqm. 24 percent of them cost between EUR 3,000-EUR 3,500. Less than a third (29 percent) have a value between EUR 3,700 and EUR 4,000/sqm.
“Although price is not the main selection criteria for luxury homes, buyers are willing to pay high prices for the properties they like. Location remains the most important criterion, followed by surface areas, facilities, the developer’s reputation and the profit in case of an economic crisis,” Imoteca found.
A two-room ultra-premium apartment with a surface area of 52 sqm costs, on average, over EUR 182,000. For a three-room apartment, the average price reaches EUR 450,000, with surface areas around 98 sqm. Four-room apartments can be as large as 140 sqm, and cost EUR 614,000 on average.
For penthouses or duplex apartments, the average unit price exceeds EUR 1 million – the average is EUR 1,214,939. These homes have generous surface areas with an average of 239 sqm.
As size is an important criterion for luxury apartments, they also have large balconies. 18 percent of the projects have balconies as large as 94-200 sqm, but most of them (35 percent) are between 23 and 32 sqm.
Prices for luxury properties will increase in the medium and long term
The areas in north Bucharest with the most ultra-premium properties have quick access to green areas like parks and lakes as well as proximity to other interest points like office and shopping areas.
“The buyer profile for luxury homes has changed. They are more informed about the market, the offers and the quality of homes, as well as maintenance and utilities costs, they are more demanding and observant, and they also seek a return, an appreciation of the properties over time. In most cases, owners are willing to pay more than they had initially planned for an ultra-premium property,” according to Imoteca.