According to the real estate consultant Re/Max Romania, in partnership with Imobiliare.ro, the factors with major influence on the domestic real estate market in 2018 were the growth of ROBOR development and the increase of both demand and prices.
The study brings together statistical data from a survey conducted on a sample of 300 respondents from 30 cities (over 50 percent real estate agents or agency owners), news coming directly from the real estate market, comparative analysis with other markets in Europe and Re/Max and Imobiliare.ro expert opinions.
The ROBOR growth
As for the ROBOR index, the following trends were noted in 2018: ROBOR declined to 3.18 percent from 3.21 percent at three months, the lowest value of the ROBOR 3M index having been recorded on June 29, 2018, and ROBOR dropped to 3.38 percent from 3.40 percent at six months, the lowest value for the ROBOR 6M index since July 3, 2018.
Demand for housing is steadily increasing, which is also confirmed by the increase in demand for building permits – in the first seven months of the year, 24,950 permits for residential buildings were issued, up 7.6 percent over the first seven months of the previous year, according to official data of the National Institute of Statistics (INS).
With the increase in demand, a rise in house prices has been seen in both Bucharest and regional centers: Cluj-Napoca (below 1 percent to an average of EUR 1,500/sqm), Iasi (2.9 percent, from EUR 1,016/sqm to EUR 1,045/sqm), Timisoara (+ 0.3 percent, from EUR 1,200/sqm to EUR 1,204/sqm).
In spite of these increases, Romanians are still among the nations with the lowest housing costs in the EU, with the only countries where residents pay less than in Romania being Bulgaria (69 percent below the EU average) and Poland (63 percent under the average EU). At the opposite end are Luxembourg (63 percent above the EU average), the UK (59 percent above the EU average) and Denmark (53 percent above the EU average).
”RE/MAX Romania is actively interested in improving the image of real estate agents in Romania, and the growth of the industry in which they operate, which is why such studies are more than necessary. At the same time, this analysis is an important milestone for both agents, brokers, agency owners, customers, sellers or buyers, providing both a review of this year and the specialists’ predictions for next year,” said Răzvan Cuc, president of RE/MAX Romania.
2019 predictions – housing prices to stagnate, 25 pct lower funds for Prima Casa, ROBOR below 3.5 percent
According to survey respondents, the 2019 real estate market comes with both positive attitudes and precaution in dealing with agents and customers. On the other hand, analysts estimate that housing prices will stagnate in 2019, or possibly grow slightly, and that by 2022 at the big cities will reach higher values, especially in areas with increased potential for economic development.
At the same time, the Prima Casa Program, the most important funding pillar in 2018, could be slowed down, with 25 percent lower funding, according to International Monetary Fund analyses. Moreover, ROBOR – at least in the case of a 3-month period – will not exceed 3.5 percent.
An interesting trend in large urban agglomerations, which has been remarkable in the past 12 months and will continue in the future, is the development of residential projects with potential around business centers.
”Buyers will be more and more demanding, and attributes such as location, seriousness, and prestige of the developer or the proposed housing concept will count more and more. We will see in the big cities the first deliveries of new-generation housing, the concepts prepared after the crisis. Of course, there will be differences from one city to another, and it is likely that regional centers such as Timisoara, Cluj or Iasi will probably perform best, as well as medium-sized towns that are going through a good period, such as Sibiu, Oradea, Arad. We look forward to a good 2019, with a healthy demand and prices under stabilization,” said Daniel Crainic, marketing director at Imobiliare.ro.