Romania Remains One of Europe's Most Affordable New Housing Markets
Romania ranks third in Europe's most affordable new housing markets, with an average price of USD 1.64 per square meter, according to the Deloitte Property Index.
RomaniaDeloitte Property IndexAffordable HousingReal Estate MarketEuropeReal Estate NewsAug 29, 2024
This index, now in its 13th edition, provides a detailed analysis of the residential real estate market across 24 countries and 69 cities. In 2023, the average price for new housing in Romania rose slightly to USD 1.64 per square meter, up from USD 1.60 per square meter in 2022.
Despite this increase, Romania's housing market remains notably more affordable compared to countries like Austria, where the average price for new housing leads at USD 5.37 per square meter.
This affordability is also evident in the number of gross annual salaries required to purchase a new 70-square-meter home. In 2023, the average Romanian needed 5.9 years' worth of gross income, an improvement from 6.3 years in 2022.
Irina Dimitriu, Partner at Reff & Associates Deloitte Legal and Real Estate Industry Leader at Deloitte Romania, commented on the market trends, noting that high interest rates continued to influence the Romanian residential real estate market in 2023.
However, recent actions by the European Central Bank and the National Bank of Romania to reduce interest rates as inflationary pressures subside could stimulate real estate investments and enhance mortgage lending.
In conclusion, Romania remains one of Europe's most affordable countries for new housing, ranking third after Bosnia and Herzegovina and Greece. Despite a slight increase in average housing prices to USD 1.64 per square meter in 2023, it remains significantly cheaper than markets like Austria.
The affordability of housing has improved, with Romanians now needing 5.9 years' worth of gross income to buy a 70-square-meter home. The recent reduction in interest rates by central banks may further boost real estate investments and mortgage lending in Romania, potentially offsetting past challenges related to high construction and mortgage costs.
About Deloitte
Deloitte is a leading global provider of audit and assurance, consulting, financial advisory, risk advisory, tax, and related services. With over 312,000 professionals in more than 150 countries, Deloitte serves four out of five Fortune Global 500 companies.
Information
The Deloitte Property Index is a comprehensive analysis of the residential real estate market across 24 countries and 69 cities. The index provides insights into the affordability of new housing, construction costs, and mortgage lending trends.
Tags Romania, Deloitte Property Index, affordable housing, real estate market, Europe
FAQs
Q What is the average price for new housing in Romania?
A The average price for new housing in Romania is USD 1.64 per square meter.
Q How many years' worth of gross income does the average Romanian need to buy a 70-square-meter home?
A The average Romanian needs 5.9 years' worth of gross income to buy a 70-square-meter home.
Q What is the most affordable housing market in Europe?
A Bosnia and Herzegovina has the most affordable housing market in Europe, followed by Greece and Romania.
Q What is the least affordable housing market in Europe?
A The Czech Republic and Slovakia have the least affordable housing markets in Europe, with buyers needing 13.3 and 12.7 years' worth of gross income, respectively, to afford a similar property.
Q What is the impact of high interest rates on the Romanian residential real estate market?
A High interest rates have driven up construction costs for developers, resulting in higher prices and mortgage rates for buyers.
Frequently Asked Questions
What is the average price for new housing in Romania?
The average price for new housing in Romania is USD 1.64 per square meter.
How many years' worth of gross income does the average Romanian need to buy a 70-square-meter home?
The average Romanian needs 5.9 years' worth of gross income to buy a 70-square-meter home.
What is the most affordable housing market in Europe?
Bosnia and Herzegovina has the most affordable housing market in Europe, followed by Greece and Romania.
What is the least affordable housing market in Europe?
The Czech Republic and Slovakia have the least affordable housing markets in Europe, with buyers needing 13.3 and 12.7 years' worth of gross income, respectively, to afford a similar property.
What is the impact of high interest rates on the Romanian residential real estate market?
High interest rates have driven up construction costs for developers, resulting in higher prices and mortgage rates for buyers.
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