Is a new apartment in Bucharest still worth it with 21% VAT?

See what went wrong for property buyers in Bucharest

What did 21% VAT actually change for Bucharest apartment buyers?

For someone signing a new purchase today, 21% VAT has made mainstream new apartments in Bucharest roughly 11% more expensive than under the old 9% regime if the developer passes the full tax increase through.

Romania moved qualifying homes with up to 120 m² of usable space and a value of no more than RON 600,000 from 9% VAT to the standard 21% rate. There is still a temporary exception for some buyers who signed qualifying pre-contracts before the old deadline. PwC's latest analysis of Law 161/2026 explains that this grandfathered 9% window was extended after disruption to Romania's cadastral systems.

That exception matters for those existing buyers, but it does little for somebody entering a new deal now. For today's buyer, 21% is the figure that should go into the budget.

The impact is also uneven. The biggest jump hits apartments that previously qualified for 9%. Homes that were already paying the former standard 19% VAT rate have only moved from 19% to 21%.

Purchase case	Previous VAT	VAT now	Gross price on €100,000 net	Increase
Previously eligible mainstream home	9%	21%	€109,000 → €121,000	11.0%
Previously standard-rated home	19%	21%	€119,000 → €121,000	1.7%
Extra cost from losing 9% VAT	—	—	€12,000	Per €100,000 net
New contract today	—	21%	Standard rate normally applies	Current baseline

Does going from 9% to 21% VAT really add 12% to the price?

Almost, but the increase in the final bill is about 11%, not 12%.

Take an apartment priced by the developer at €100,000 before VAT. Under 9% VAT, the buyer paid €109,000. At 21%, that same apartment costs €121,000. The extra €12,000 equals 12% of the net developer price but about 11% of what the buyer previously paid.

At €120,000 before VAT, the difference becomes €14,400. At €150,000, it reaches €18,000.

Those are big numbers for the buyers targeted by the old reduced rate. An extra €14,000 or €18,000 can wipe out most of a down payment, push a household into a larger mortgage or simply move the desired apartment outside the bank's affordability calculation.

The important caveat is that these calculations assume the developer keeps the same net price. In practice, some developers are cutting margins, including parking or changing payment schedules. So 11% is the tax shock, not necessarily the exact increase a buyer eventually pays.

Are Bucharest developers absorbing the 21% VAT increase?

Only partly. Developers are negotiating more today, but the latest prices show that they have not collectively absorbed the VAT increase for buyers.

Imobiliare.ro's latest Bucharest data puts new-apartment asking prices at roughly €2,549/m². That is about 9.3% higher than a year earlier and roughly 27% above two years earlier.

That is hard to square with the idea that developers have broadly cut their underlying prices enough to cancel the tax increase. A 60 m² apartment priced at the citywide average now carries roughly €33,000 more asking value than the same 60 m² at the average level seen two years earlier.

Discounting is happening, though. Colliers says buyers have become much more focused on price and total ownership cost, while the gap between stronger and weaker projects is widening. In practice, weaker developments increasingly compete through discounts, included parking or more flexible payment terms.

So there is more room to negotiate these days, especially where a developer has plenty of unsold stock. Buyers should not assume that means the whole market has repriced downward.

Bucharest new apartments	Approx. asking price	Change
Two years earlier	€2,000/m²	—
One year earlier	€2,333/m²	+16.7%
Latest reading	€2,549/m²	+9.3% YoY
Two-year increase	€549/m²	~27%
Increase on a 60 m² unit	~€32,940	Before property-specific differences

Did 21% VAT kill demand for new apartments in Bucharest?

No. Bucharest buyers have become harder to convince, but demand has held up much better than the VAT shock alone would suggest.

Colliers' newest residential update shows apartment transactions in Bucharest down only around 2% year on year during the first half of 2026. Across Romania, the decline was about 9%.

That is quite a recovery from the beginning of the year. Colliers had measured a drop of roughly 20% in Bucharest apartment transactions during the first two months.

Part of the market has also been distorted by buyers trying to complete purchases around changes to the VAT rules, so monthly sales should not be read too literally. Still, moving from roughly -20% early in the year to about -2% over the full first half tells us something useful.

Buyers did not disappear. They became more selective.

That reduces the odds of every developer being forced into the same response. Projects with weak locations or aggressive prices can struggle while attractive projects keep selling.

Is Bucharest actually short of new apartments right now?

Yes. The number of new apartments available to Bucharest buyers has fallen sharply, and that shortage is giving good projects more pricing power than the 21% VAT story alone would suggest.

Imobiliare.ro counted about 13,000 new apartments available to buyers during the first half of 2026. One year earlier there were almost 16,800. Two years earlier there were around 15,200.

So available new supply fell by about 23% in one year.

The broader construction data also helps explain why. Colliers says Romanian housing completions fell to roughly 59,000 units in 2025, the lowest total since 2017. Bucharest has been dealing for years with slow permitting and limited development opportunities in established areas.

There is now a strong change further up the pipeline. The net residential floor area authorised in Bucharest during the first five months of 2026 was 3.6 times the previous year's level, according to Colliers.

Those permits could eventually ease the shortage, but they do very little for somebody trying to buy a finished apartment today. New projects still need financing, construction and sales before those authorised square metres become keys in buyers' hands.

Bucharest supply measure	Earlier level	Latest level	Change
New homes offered in H1	~16,800	~13,000	-23% YoY
New homes offered two years earlier	~15,200	~13,000	Lower today
Residential floor area authorised	Baseline	3.6× previous year	Pipeline accelerating
Romania housing completions	Higher in prior years	~59,000 in 2025	Lowest since 2017
What buyers face now	—	Tight completed supply	Still supportive of good projects

Could all the new construction coming to Bucharest make waiting smarter?

In some neighbourhoods, yes. Bucharest has a much stronger future construction pipeline now, and buyers in heavily developed areas should take that competition seriously.

The increase in residential permits is too large to ignore. Colliers also sees developers preparing more projects for the next development cycle after several weak years for authorisations.

Location changes the answer completely. Earlier Imobiliare.ro pipeline data identified more than 5,700 planned apartments around Theodor Pallady and roughly 4,400 around Pipera. Other sizeable pipelines appeared in Drumul Taberei, Băneasa, Colentina, Străulești and Obor.

A generic apartment in a district where thousands of similar units can still be built has weaker scarcity value. The owner may eventually have to resell against newer phases with newer finishes and launch incentives.

Waiting makes less sense when the apartment occupies a genuinely scarce site: near an established metro station, inside a built-up neighbourhood, with little land left for large competing projects.

So the better question is not whether Bucharest is building more. It is how easily somebody can build another 500 apartments that look like the one we are considering.

Are new apartments in Bucharest still much more expensive than old ones?

Yes on the latest citywide Imobiliare.ro numbers, but the average premium is only about 12.5%, and location can completely reverse the comparison.

New apartments are currently advertised at roughly €2,549/m² on average, against around €2,265/m² for old apartments. That leaves a difference of about €284/m².

On a 60 m² apartment, the citywide premium is roughly €17,000.

The comparison gets messy because Bucharest's old and new stock sits in very different places. Many expensive older apartments are in established central or semi-central neighbourhoods where very little new housing can be built. Large volumes of cheaper new construction sit much farther out.

That explains why other datasets have occasionally shown old Bucharest apartments priced above new ones. They were measuring different mixes of neighbourhoods rather than discovering that age somehow increases value.

For an actual purchase, the useful comparison is much narrower: similar usable area, similar metro access, similar micro-location and similar parking situation. Only then can we see what buyers are really paying for the new building.

Latest Bucharest asking-price comparison	Approx. price
New apartments	€2,549/m²
Old apartments	€2,265/m²
New-build premium	€284/m²
Percentage premium	~12.5%
Premium on 60 m²	~€17,040

Is buying an old Bucharest apartment now the obvious way to avoid 21% VAT?

No. Avoiding 21% VAT can make a good old apartment much more attractive, but buying the wrong old building just to escape the tax is a poor trade.

Bucharest has plenty of older apartments in excellent locations. A renovated unit in a sound building near an established metro station can easily beat a generic new apartment far outside the centre.

But age brings very different risks in Bucharest. Building condition, seismic classification, plumbing, electrical systems, façade work, elevators, insulation and common-area maintenance can all change the economics.

Energy costs are becoming part of that comparison as well. Colliers says buyers are paying more attention to energy efficiency and total ownership costs, while banks such as ING and Raiffeisen currently offer better mortgage pricing for qualifying energy-efficient homes.

None of that gives developers permission to charge any premium they want. Saving money on heating will never justify paying tens of thousands of euros too much.

The better comparison is simple: what does the extra money buy us? If the answer is a stronger building, lower maintenance, better insulation, parking, a good layout and a location that will remain easy to resell, the premium can make sense. If the main answer is “the finishes are new,” it probably does not.

How much worse does 21% VAT make a Bucharest mortgage?

For a financed buyer, 21% VAT hurts twice because the apartment costs more upfront and part of that extra cost can then accrue mortgage interest for years.

Using the same €100,000 pre-VAT apartment, the gross price rises from €109,000 under 9% VAT to €121,000 at 21%.

With a 20% down payment, the mortgage would move from roughly €87,200 to €96,800. At an illustrative 5.3% rate over 30 years, the payment rises by around €53 a month.

Mortgage rates themselves are still expensive enough to make that difference noticeable. ING currently advertises a three-year fixed mortgage from 4.79% and a five-year fixed option from 5.29% for qualifying borrowers. Its published variable rate is 7.11%. Raiffeisen is advertising three-year fixed pricing from 4.90% and five-year fixed pricing from 5.65% on its standard Casa Ta mortgage.

A buyer who needs leverage should be stricter today than a cash buyer. An apartment that only fits the budget after assuming much cheaper refinancing later is already pushing affordability too far.

€100,000 net apartment	With 9% VAT	With 21% VAT
Gross purchase price	€109,000	€121,000
20% down payment	€21,800	€24,200
Mortgage required	€87,200	€96,800
Payment at 5.3%, 30 years	~€484/month	~€537/month
Extra monthly payment	—	~€53
Extra cash for down payment	—	€2,400

Are Bucharest incomes keeping up with new apartment prices?

No. New Bucharest apartments have recently been getting more expensive much faster than Romanian wages, which makes today's 21% VAT harder to absorb.

Romania's average net salary reached 5,734 lei in June 2026, around 3.5% higher than a year earlier. Bucharest wages are much higher: official statistics put the capital's average net salary at 7,631 lei in April.

New-apartment asking prices, meanwhile, are about 9% higher than a year ago and approximately 27% higher over two years.

The gap is especially uncomfortable for the middle-income buyer who used to qualify for 9% VAT. That household is facing higher property prices, a much higher tax rate and mortgage products still commonly starting around 5% even during introductory fixed periods.

There is plenty of desire to buy. A Colliers survey found 42.5% of urban respondents planning a home purchase within six to twelve months, compared with 35.2% the previous year.

Wanting an apartment and being able to finance the apartment have increasingly become two different things. That is why developers can still report interest while buyers negotiate harder or abandon specific units.

Can a new Bucharest apartment still work as a rental investment with 21% VAT?

Yes, but the numbers need to be unusually good now because 21% VAT directly lowers the yield on a new apartment if the rent stays the same.

Imobiliare.ro puts the average advertised Bucharest apartment rent at about €675 a month during the first half of 2026, up only around 4% year on year. Available rental stock fell about 9% over the same period.

That is a decent rental backdrop. It still cannot automatically compensate for an 11% jump in acquisition cost on apartments that previously qualified for 9% VAT.

Imagine a unit earning €600 a month, or €7,200 a year. At a €109,000 purchase price, the gross yield is 6.61%. Raise the acquisition cost to €121,000 while keeping rent unchanged and the gross yield drops to 5.95%.

Then we still have vacancy, furnishing, repairs, insurance, taxation and potentially management costs.

For investors, the full VAT-inclusive price per rentable square metre now deserves more attention than the developer's headline pre-tax price. A 5% to 6% gross yield can become pretty ordinary once real expenses are deducted.

Simple rental example	€109,000 purchase	€121,000 purchase
Monthly rent	€600	€600
Annual rent	€7,200	€7,200
Gross yield	6.61%	5.95%
Yield lost	—	0.66 percentage points
After ownership costs	Lower	Lower again

Which Bucharest new-build areas are easiest to overpay for?

The biggest overpayment risk today is in neighbourhoods where buyers are paying a premium for an apartment that developers can reproduce hundreds or thousands of times.

Theodor Pallady is the obvious example. The area has real advantages, including metro access and a huge amount of commercial development, but earlier pipeline data showed more than 5,700 planned apartments there.

That level of construction gives future buyers plenty of choice. Someone reselling an ordinary two-bedroom unit may be competing with brand-new apartments offered directly by developers with fresh kitchens, payment plans and launch promotions.

Pipera needs the same discipline for a different reason. Earlier pipeline estimates exceeded 4,400 apartments, and the name covers locations with wildly different access to offices, schools, roads and public transport. Paying a “north Bucharest” premium for a car-dependent micro-location can be difficult to recover later.

Large pipelines have also appeared in Drumul Taberei, Băneasa, Colentina, Străulești, Obor, Militari, Rahova and Berceni.

None of those areas should be rejected as a category. Some will grow into much stronger neighbourhoods. But where new supply is easy to add, the price we pay today matters more because scarcity will not rescue a bad purchase.

Where can a new apartment in Bucharest still justify 21% VAT?

The strongest new-build purchases today are in places where good modern housing is hard to reproduce and buyers already want to live there.

Recent Imobiliare.ro data shows the sharpest improvement in demand relative to available new supply in Tineretului-Timpuri Noi, up around 15%, followed by Drumul Taberei at 12%, Băneasa at 8% and Aviatorilor at 7%.

Those four percentages are not a league table of places to buy. They are more useful as evidence that established transport, services and employment access are still pulling buyers even in a more difficult market.

Tineretului-Timpuri Noi is a good example. A modern apartment close to existing metro stations, central employment areas and mature neighbourhood infrastructure has attributes that a cheaper project on open suburban land cannot easily copy.

The same logic can work in parts of northern Bucharest, where buyers and tenants value office access, schools and established amenities. But the micro-location needs to deserve the price; “north” by itself is far too broad.

With 21% VAT, we should be paying for scarcity, connectivity and quality. An ordinary project on abundant land has a much harder time earning that tax-inclusive premium.

Should we wait for Bucharest developers to cut prices?

Waiting for a citywide collapse looks like the weaker bet right now, although waiting for an overpriced individual project can make perfect sense.

As seen above, new-home availability fell by roughly 23% year on year in the first half. That gives well-located projects some protection even as buyers become more cautious.

At the same time, future supply is finally picking up. The sharp rebound in authorised residential floor area tells us developers could have more competing stock later, particularly in districts with plenty of buildable land.

That combination should produce very different outcomes from one project to another. Some developers will discount. Others can probably hold their price.

The latest Colliers assessment already describes a widening gap between projects rather than a uniform market movement. Bucharest apartment transactions were only around 2% lower in the first half despite a much weaker start to the year.

So waiting makes sense when we have a specific reason: too much competing supply, a weak developer, an inflated launch price, poor sales or a project whose advantages exist mainly in the brochure.

Waiting because “21% VAT must eventually make every developer cut prices” has much less evidence behind it.

How long should we plan to keep a new Bucharest apartment?

For a new Bucharest apartment bought with 21% VAT, we would be much more comfortable with a seven-to-ten-year holding period than a two-or-three-year one.

The tax raises the amount paid on entry, but a future resale buyer will not reimburse us for the VAT. That buyer will simply compare our apartment with whatever old and new properties are on the market then.

Short ownership therefore leaves little time for salary growth, mortgage repayment, rent saved and neighbourhood improvement to offset a high acquisition cost.

A long holding period also makes the advantages of a good new building more useful. Better energy performance, lower near-term renovation needs, parking and easier day-to-day living have years to accumulate value for an owner-occupier.

For somebody who may leave Bucharest, change jobs, need a different-sized home or sell again within a few years, the new-build premium deserves much more scrutiny now.

The 21% VAT has made short holding periods less forgiving.

What would make us reject a new apartment in Bucharest today?

We would walk away from a new Bucharest apartment if its 21%-VAT price needs several optimistic things to happen at once before the purchase looks good.

The first problem would be a large premium over comparable homes without a clear improvement in location, layout, construction or ownership costs.

Another would be heavy future competition. If thousands of similar units can still be built nearby, we would want a lower entry price or something genuinely difficult to copy.

We would also discount promises about infrastructure that has not been delivered yet. A future metro extension, road or school can add value, but the apartment should not already be priced as though everything is open and working.

For an investor, weak rent relative to the total purchase price is enough to kill the deal. For an owner-occupier, a mortgage that only becomes comfortable after assuming lower future rates is another warning.

One bad assumption can be survivable. A deal that needs rapid appreciation, cheaper mortgages and strong rent growth simultaneously has too little room for error.

So, is a new apartment in Bucharest still worth it with 21% VAT?

Yes, but 21% VAT has raised the bar enough that an average new apartment in Bucharest is no longer an easy buy.

For mainstream apartments that previously qualified for 9%, keeping the developer's net price unchanged raises the buyer's final bill by roughly 11%. Mortgage buyers can then pay interest on part of that extra cost, while landlords see their yield fall unless rents rise as well.

The market has nevertheless refused to follow the simple “higher VAT equals falling prices” script. New asking prices are still about 9% above a year ago. Supply available to buyers has dropped sharply. Bucharest transaction volumes recovered from a very weak start and finished the first half only around 2% below the previous year, far better than Romania's roughly 9% decline.

Those facts give good projects room to hold their value. They give mediocre projects much less protection.

For an owner-occupier planning to stay seven to ten years, we would still buy a genuinely good new apartment near established transport, jobs and services when the price is sensible relative to nearby resale stock. Modern construction, energy efficiency, parking and lower renovation risk can justify paying more.

For a buyer already stretching the mortgage budget, we would be much more reluctant. Current fixed mortgage offers still start around 5% for many borrowers, and combining expensive financing with the higher VAT leaves little room for a bad purchase.

For an investor, the threshold should be higher again. A generic new apartment producing only an ordinary yield after the full VAT-inclusive purchase price is included has no special claim to being attractive just because it is new.

And in areas where developers can build thousands of similar apartments, we would negotiate hard. Future supply can keep today's supposedly premium unit from feeling very premium at resale.

So our answer today is yes, selectively. Bucharest still has new apartments worth buying at 21% VAT, but the tax has removed much of the cushion that used to protect an average decision. The property now has to justify its own premium through location, scarcity, quality or unusually good economics.

If it cannot, we would buy resale or wait.

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