Regarding the time required to buy a 2-room house (55 sq m), without taking into account living expenses or savings and without financial support from banks, the highest level of the indicator is recorded in Cluj County, where it takes approximately 11 years to buy a house.

These are the conclusions of the section of the stability report published on Thursday by the National Bank, which shows where Romania is in the real estate market compared to neighboring countries.

It takes about 12 years in Vienna, almost 18 years in Prague and about 15 years in Budapest and Warsaw to buy a 55 square meter house without a mortgage, BNR data show.

On the other hand, in counties such as Giurgiu, the indicator does not exceed the value of six years.

A quarter of all real estate deals are in Bucharest

Ongoing challenges in the residential real estate market in Romania are represented by regional differences in real estate supply and demand and low levels of involvement and financial intermediation in less developed regions of the country. These problems arise from the asymmetry of economic development at the level of regions.

A quarter of all real estate deals are in Bucharest. Another 28 percent of transactions are concentrated in the main regional centers of the country, respectively: Cluj, Brasov, Timișoara, Constanta and Iași.

There are residential real estate assets in Bucharest and Timisoara understatedand in Cluj-Napoca and Brasov, overratedand in Constanta they are correctly assessed, the Central Bank shows

Transaction costs in Romania are moderate and amount to 4.4-10.2 percent for the buyer

The lowest number of transactions can be found in the counties of Giurgiu, Teleorman, Covasna, Olt or Salai (less than 0.6 percent of the number of transactions takes place in each of these counties). A significant part of operations with individual divisions is financed by bank credit (about 38 percent).

Transaction costs are moderate in Romania and range from 4.4 to 10.2 percent for the buyer and include: stamp duty, notary fees and registration fee and from 3 to 6 percent for the seller

The highest transaction costs are recorded in France, Malta or Belgium, but in Bulgaria, the Czech Republic or Poland, transaction costs for real estate are lower than in Romania.

Prices for residential real estate in Romania increased by 8.5% in the first half of 2022

According to data as of September 2022, the construction cost index for the residential building segment registered an annual growth rate of 14.3 percent on the back of rising raw material costs as well as supply chain issues. Rising construction costs are likely to put further upward pressure on property prices.

Residential real estate prices in Romania increased in the first half of 2022 (+8.5 percent year-on-year), but remained at the lowest level in the region and, at the same time, below the averages of the European Union (+10 percent) and the Eurozone (+ 9.3 percent). At the same time, during the last 10 years, the dynamics of prices for residential real estate in Romania was lower compared to prices in the region.

The dynamics of prices in the next period depends on a number of factors, such as macroeconomic conditions, the general strengthening of financing conditions against the background of rising interest rates and increasing uncertainty in the new geopolitical context. They are likely to reduce potential demand from the population and, implicitly, moderate the rise in property prices

Photo source: Dreamstime