Romanian consumer confidence has dropped to one of its lowest levels in the past 15 years, consultancy company Colliers said in a recent report. After several years of record demand, Romania’s housing sector entered 2025 in a cooling phase as buyers grew more cautious.
Consumer sentiment saw its steepest half-yearly decline since the 2009–2010 financial crisis, excluding the short-lived pandemic shock, Colliers noted. This downturn, however, is expected to be deeper and longer-lasting, weighed down by a weaker labour market, political instability, and fiscal changes eroding household purchasing power.
The government decision to raise VAT to 21% from August 1 spurred a temporary rush of transactions, making July one of the busiest months in years. But Colliers analysts warned the effect would be short-lived, with higher taxes, energy costs, and fuel duties, combined with persistently high interest rates, likely to curb activity in the final months of 2025.
In the first eight months of the year, nearly 106,000 housing units were sold nationwide, roughly unchanged from 2024, according to official data.
“Although construction indicators, building permits, and buyer sentiment all show significant declines, the market is not entering a recession comparable to 2009–2010. Rather, we are witnessing a normalisation after several exceptionally strong years in which demand consistently outpaced supply,” said Gabriel Blăniță, Associate Director for Valuation & Advisory Services at Colliers Romania.
“Over the long term, the fundamentals remain solid: major cities continue to face overcrowding and a housing deficit, while purchase intentions remain well above pre-pandemic levels. These developments suggest the residential market is undergoing a period of adjustment, not a structural downturn,” he added.
Prices in Romania’s largest cities have continued to rise by around 5% in the first half of 2025, driven by higher construction costs and demand for central properties. In contrast, suburban and metropolitan areas, where land is more affordable, saw more moderate growth and resilient supply.
Colliers said the short-term outlook points to weaker demand and fewer transactions as high borrowing costs and fiscal pressures bite. Yet, it stressed that the long-term outlook remains positive, with Bucharest and other major urban centers still facing a housing shortage.
International bodies, including the IMF and World Bank, do not foresee an economic downturn comparable to the 2009–2010 crisis, the company added.
irina.marica@romania-insider.com
(Photo source: Tero Vesalainen/Dreamstime.com)
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