Overall, the volume of construction works in Romania posted a 5% y/y advance in Q4 2025, after a sharp 14.4% y/y surge caused by one-off accelerated reporting/contracting not linked to real activity, but the dynamics of the three main segments of the market have very different dynamics. In seasonally-adjusted terms, the construction works activity plunged by 9.8% q/q in Q4, reversing the 12.4% q/q advance in Q3 (one-off effects), according to the statistics office INS.

The growth drivers for the coming quarters remain public works (civil engineering) backed by abundant EU funding (Resilience Facility) and non-residential buildings driven by highly dynamic sub-segments in the logistics and industrial area. The residential buildings segment has lost momentum through 2023, failed to gain ground in 2024, and somehow recovered in 2025 – but the outlook as reflected in households’ sentiment and still high interest rates remains gloomy.

The volume of works for non-residential projects in Romania rose by over 20%y/y in each of the last two quarters in 2025, while the public works segment has gradually lost momentum: +7.7% y/y in Q3 and -5.3% y/y in Q4, as the government has rationalised the use of public funds, channelling the limited resources to realistic projects. The residential buildings segment, after a weak year in 2024, is gradually gaining ground on base effects with double-digit growth rates in both Q3 (+28.1% y/y) and Q3 (+11.5% y/y). 

For 2025 as a whole, the volume of construction works rose by 8.0%, fully reversing the 5.6% decline in 2024 and reaching a new record – one third above the average level in 2021. However, while the public works segment remained nearly 60% above the average 2021 level despite a plunge in H2 and the modest 4.5% y/y overall annual advance, the residential building lagged some 10% below the 2021 average level after the 11.4% y/y in 2025. 

The non-residential segment is roughly in line with the overall market activity level 931% above 2021) after a robust 13% y/y advance in 2025 and a visible upward trend.

In a recent report, real estate consultancy firm Colliers warned that the short and medium-term outlook is marked by additional cost pressures (labour and decarbonisation). A carbon tax on construction materials imported from outside the European Union has come into force from 2026, and early estimates indicate a potential impact of 10%–15% on costs, but the actual extent will become clearer throughout the year.

Given the high dependence on imports of steel, aluminium, and other metals, it is unlikely that these additional costs will be fully absorbed by companies. A significant part will be transferred to the production chain, which will put pressure on the final prices of projects, in a context where financing remains selective, and costs are already at high levels.

The pressures are amplified by the global geopolitical context and rising raw material prices, Colliers warned. The price of copper, an essential construction material, increased by over 40% in 2025, reaching historical highs, and other base metals have also recorded significant price increases.

In the local labour market, the construction sector reached a record level of labour, with about 462,000 employees in July 2025, up 1% from the previous year. Even though wage pressures are visible, the level of construction wages in Romania remains below that of other Central and Eastern European countries, which gives companies some room for manoeuvre in a context of rising costs.

iulian@romania-insider.com

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