The residential property market ended 2025 with its weakest fourth-quarter performance in years, after the VAT increase weighed heavily on demand, according to a report by real estate consultant SVN Romania. The final quarter marked the weakest year-end for residential sales in the Bucharest–Ilfov area in the past nine years and the poorest fourth-quarter result nationwide since 2019.

Overall, more than 159,500 homes were sold across Romania in 2025, down 5.3% from 2024, while transactions in Bucharest–Ilfov fell by 8.5% to just over 55,000 units, based on data from the National Agency for Cadastre and Land Registration.

SVN said sales peaked briefly in July 2025, ahead of the VAT increase that took effect on August 1, with transactions in Bucharest–Ilfov up 12.6% year on year, followed by a smaller rise in August. This was followed by sharp declines in the final months of the year, with annual drops of more than 20% recorded in October, November, and December - an unusual pattern for a period that typically sees the highest transaction volumes.

“Home sales closed on the middle market segment are still very good, since the VAT increase for these homes was marginal – and this shows that the housing deficit is real and demand is still solid overall. But the accessibility for new housing has been significantly hampered in the mass market segment, which will also lead to an increase in rents in the short and medium term,” said Andrei Sarbu, CEO of SVN Romania.

“Tax increases can be beneficial if they bring higher budget revenues, but if they lead to losses through decreased sales and investments, the economy as a whole suffers much more – which will ultimately lead not to gains but to significant losses!”

Timiș was, once again, the main regional residential market in Romania, except the Bucharest-Ilfov region, considering the number of homes traded, thus surpassing Cluj, Constanța, Brașov, and Iași, according to the data centralised by SVN Romania.

The best results registered among the main regional residential markets in Romania were registered in Cluj, where sales increased last year by an annual rate of 1.7%, and in Constanța, where the number of residential units sold last year was similar to that recorded in 2024.

On the other hand, the most significant annual decreases in the number of residential units sold last year were recorded in Iași, where sales decreased by a yearly rate of 23.5%, and in Brașov, where residential sales declined by an annual rate of 13.8%. In Timiş, a 6.4% lower home sales result was recorded.

irina.marica@romania-insider.com

(Photo source: Tinnakorn Jorruang/Dreamstime.com)