The amount of property investments in Romania totalled €336 million in the first half of 2022, up around 13% year-on-year, while solid pipeline of transactions is under negotiation and could be completed by the end of the year, according to a report of real estate consultancy CBRE. 

By the end of the year, the market could record investments of around €1 billion, led by transactions in the office sector. In fact, deals involving office building generated 63% of volumes in the first half of 2022. The retail sector covered around 16% of the transactions and the industrial and logistics segment had a share of 14%. The rest was covered by the hotel segment.

Leasing volumes in the Romanian industrial and logistics market rose by 50% to 542,000 sqm compared to the same period of last year, with more than half of the activity being generated around Bucharest. Demand was driven mainly by retail and e-commerce (28%), along with logistics and distribution (11%) and automotive (5%) as shares of the closed leased deals, according to a report by real estate consultancy Cushman & Wakefield Echinox.

Fewer homes bought with bank loans in Romania

Transactions of apartments and houses began to decline starting from the spring of this year, as a result of high energy costs, rising construction materials and fuel prices, in addition to the rising costs associated with mortgages, according to real estate consultancy Colliers. 

In Bucharest, owners took on bank debt for 50% of the apartments traded in the first six months of this year. Meanwhile, 60% of apartments were bought on loan, which means that currently not only are there fewer transactions that depend on bank loans, but also that part of the demand has become unbankable and can no longer afford the loan costs for buying the desired home.

In the rest of the country, 44% of transactions were made with credit in the first half of the year, a percentage slightly down from the level of 45% recorded in 2021. Recent demand-side indicators suggest that cheaper homes are relying more on credit, while more expensive, luxury homes are largely traded for cash.