Just over 21,000 new homes were delivered in Bucharest and Ilfov in 2023, according to the data from the National Institute of Statistics, down 1.3% compared to 2022's result. SVN Romania estimated a year ago that approximately 19,000 residential units could be delivered in 2023 in the region.
The higher delivery result was mainly due to significant increase in the number of completed homes registered in the fourth quarter of last year, in a context in which developers accelerated the delivery of projects so that buyers could benefit from the higher price ceiling for which 5% VAT applied for pre-sales sign in 2022.
The significant decrease in the new supply this year is registered in a context in which home sales registered in Bucharest and its surroundings at the beginning of this year increased by almost 24% compared to January – February 2023, being even higher compared to the first two months of 2022, a record year for home sales, according to the data published by the National Agency for Cadastre and Land Registration.
At the same time, the number of construction permits issued in Bucharest for residential buildings decreased in 2023 by 18.7% compared to 2022 and by 37.5% compared to 2021, while the total net area authorised in residential buildings in 2023 in Bucharest was 54% lower than the 2022 level, according to the official statistics.
”We're seeing fewer new residential projects, both in construction and advanced planning phases. The increase in home sales and the decrease in construction permits issued will lead to a better absorption of new developed projects and will create the premises for a more significant price evolution compared to the one registered in 2023”, stated Andrei Sârbu, CEO of real estate consultant SVN Romania.
The areas in the north of Bucharest will continue to attract the largest number of homes that could be delivered in 2024, with a share of almost 40% of the new supply. This, this is the third consecutive year in which the north of the city is the most important residential development pole in Bucharest, in a context of increasing incomes and, implicitly, of increasing offer targeting the middle market segment. The areas located in west part of the city will attract approximately 24% of 2024's new supply, while the east will attract approximately 17% and the south areas about 15% of the new homes supply.
Most homes due to be completed in Bucharest and its surroundings target the mass market segment, with a share of about 59%, while the middle market segment will account for about 36.5% of the new supply and the premium segment for approximately 4.4%.
In addition to the homes that could be delivered in the city and its surroundings by the end of this year, another approximately 11,000 residential units are in different construction phases, with delivery dates set for 2025 and 2026, according to SVN's data. The official registration of this homes as delivered will depend, as every year, on compliance with development schedules and the pace of drawing up all the specific documents for project receptions.
