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Real Estate: 2022 sets new records on Bucharest’s residential market
2022 will most likely lead to new records on Bucharest’s residential market in terms of home sales as well as, possibly, dwelling deliveries, shows a market report prepared by real estate consultant SVN Romania and based on official statistics and own research data.
Thus, over 52,000 homes were sold in Bucharest and its surroundings in the first ten months of 2022, up 9.16% compared with the similar period from 2021, according to data published by the National Agency for Cadastre and Land Registration. 2021 was the best year in the modern history of the local residential market, with an annual increase of 37% in homes sales registered in the region, while 2020 also closed with a 5.3% increase compared to 2019.
At the same time, over 27,000 new homes were under construction at the beginning of this year in Bucharest and its surrounding, according to SVN Romania’s research, this being the biggest figure in recent years. Thus, 2022 could bring a new delivery record, most recent data published by the National Institute of Statistics showing that deliveries increased by 14.7% in H1 2022 compared with H1 2021.
”2022 was a new very good year for the local residential market, despite the general unfavourable context, the constant increases in inflation and interest rates and the constant negative forecasts. 2023 will, most likely, bring a lower number of deliveries in Bucharest and its surroundings and implicitly fewer transactions, taking also into account the fact that the reporting base is represented by absolute records. Overall, home sales increase by over 53% in the last three years and 2023’s results must be analysed in this context,” stated Andrei Sarbu, CEO SVN Romania.
Results registered in 2022 were obtained in a context in which the accessibility of purchasing a new home remained at a satisfactory level according to the profile index calculated by SVN Romania, based on average prices and statistics regarding the average price at a national level.
Thus, 103.8 average wages at a national level, the equivalent of an 8.6 years, were needed in September – the latest month with official data regarding average wages – in order to buy a one-bedroom new apartment in Bucharest, with a net surface of 50 square meters. For comparison, 102,3 average wages, or a period of 8.5 years were needed a year ago, in September 2021, for purchasing the same apartments, down only 1.5% in the last 12 month marked by an extreme unfavourable context.
A 16% annual price increase on the new segment was considered, while the national average wage increased by 13.8% in the last years and the RON-EUR exchange rated remained stable. The current value of the SVN’s index is still almost four times smaller compared to the 2008 peak, when 393 average wages, or a period of almost 33 years, were needed in order of buying the same apartment in Bucharest. Official statistics also show that over 50% of home sales registered in the region are cash only, without contracting a mortgage loan.
SVN Romania is one of the most important real estate consultants active on the Romanian market and the leader of the residential segment. The company has also three regional offices, in Brasov, Cluj – Napoca and Covasna, and is the real estate consultant and exclusive broker for over 15 residential projects located in Bucharest and in the country. SVN International Corp. has over 200 offices in eight countries and regions, with over 1,600 real estate consultants, brokers and staff.