Buying a property in Bucharest: a complete guide

All sources have been thoroughly verified for credibility. Furthermore, a local real estate expert has reviewed and approved the final article.

Yes, the analysis of Bucharest's property market is included in our pack

Ever thought of purchasing a property in Bucharest? You're not alone!

Many people are intrigued by Bucharest's mix of history and modernity, dreaming of owning a contemporary apartment or a stylish villa.

Would it be a good investment, though? Are property prices increasing in Bucharest? What is the current trend? Is it better to invest in Lipscani or Dorobanti? What are the taxes? Where are the best yields?

We have the answers.

The Investropa team has done their homework and know this market well. Actually, we've compiled all our findings in one pack. Get it now.

In this article, we'll provide you with helpful information.

How's the real estate market in Bucharest?

Is the property market in a good shape or a challenging one? Data will tell us the story.

Property types

In Bucharest, you can find various types of properties for sale to suit different needs and preferences.

These include apartments in different sizes and locations, from cozy studios to spacious penthouses; houses with diverse designs, such as standalone homes and townhouses; commercial properties like shops, offices, and warehouses; and plots of land for potential development or building.

Whether you're looking for a place to call home, an investment opportunity, or a business space, Bucharest offers a range of property options to explore.

Better to buy or rent?

(If you're keeping it for yourself and not renting it)

Whether you've already made Bucharest your home or are considering it for the future, you might be considering whether to buy or rent a property in the capital of Romania.

Obviously, it's better to buy if you are looking to build equity and gain long-term financial security.

Actually, the property price-to-rent ratio is a good metric to look at for this kind of decision. This metric shows the relationship between rental income and the cost of buying the property.

According to Numbeo, the property price-to-rent ratio in Bucharest is around 23.39, which is around the world average.

To put it simply, it usually takes around 23 years of rental payments to buy a property in Bucharest.

Property prices in Bucharest

On average, according to the last data from National Institute of Statistics Romania, purchasing a property in Bucharest would cost you around $2,630 per square meter.

Obviously, there is a significant spread. The value of a square meter for an apartment in Bucharest might differ from a suburban home in Pipera. We actually offer a more in-depth analysis in our pack for buying property in Bucharest and in Romania.

To put things in perspective, it means that, instead of buying an apartment in Paris or London, you can afford 5 properties in Bucharest.

Also, housing prices in Bucharest are 45% cheaper than in Budapest.

The most expensive neighbourhoods in Bucharest are probably Herastrau, Dorobanti, Primaverii, Aviatorilor and Baneasa, while the cheapest are Ferentari, Rahova and Pantelimon.

Trends

First, let's acknowledge that Romania currently ensures a stable environment for investors. The last Fragile State Index that has been reported for this place is 50.8.

Remember this when thinking about whether it's a good idea to buy a property in Bucharest.

Besides that, if we look at the IMF's GDP forecasts, Romania's economy is expected to soar by 15.2% in the coming 5 years, resulting in an average GDP growth rate of 3%.

If you're about to invest in real estate in Bucharest it's a good thing because an expanding economy (usually) leads to higher incomes for citizens, enabling them to invest in real estate, which boosts demand and prices for properties.

Also, in Romania, the average GDP per capita has changed by 13.9% over the last 5 years. It is well above the average seen worldwide.

These are positive signals showing that property prices in Bucharest might increase in 2024 and during the coming years.

Looking for more updated data? We've done a big-picture study to find out if it's a good idea to purchase property in Romania right now.

Buying property in Bucharest

Buying real estate in Bucharest can be difficult due to the lack of reliable and updated information available for the purchasing process. That's why we have created the pack to buy property in Bucharest and in Romania.

Buying process

Within our pack, we have outlined the complete buying process. This includes the necessary documents, the applicable taxes, as well as information about where to locate properties, and more.

Here, we are providing you with a simpler version to assist you in better comprehending the information.

This is the step-by-step process to purchase a property in Bucharest:

1. Define your budget and property requirements.
2. Engage a local real estate agent or search online listings (e.g., Imobiliare.ro).
3. Arrange property viewings to assess potential options.
4. Conduct due diligence, including verifying the property's "Carte Funciara" (land book) status and checking for any debts or encumbrances.
5. Hire a notary public and draft a "pre-contract" (antecontract) which outlines the terms and conditions of the sale.
6. Pay a deposit (around 10%) to secure the property, as per the pre-contract.
7. Obtain necessary permits and approvals from the City Hall and other relevant authorities.
8. Complete the final sale-purchase agreement (contract de vanzare-cumparare) with the notary and sign it in the presence of both parties.
9. Pay the remaining balance and associated taxes, including the 3% property transfer tax (impozitul pe transferul dreptului de proprietate).
10. Register the property with the Land Registry Office (Cartea Funciara) to formalize the ownership transfer.
11. Transfer utilities and other property-related services to your name.
12. Celebrate, you are now a property owner in Bucharest! Keep the title deed (Titlu de Proprietate) in a safe place for future reference.

Also, if you're not from the country, you might want to check our article on how to buy property as a foreigner in Romania.

Make a profitable investment in Bucharest

Better information leads to better decisions. Save time and money. Download our guide.

Download Now

Where to find a property

Check out these websites to find properties in Bucharest.

• Regatta - They offer real estate services in Bucharest since 1993. Find properties for sale, rent, and investment opportunities in all market segments.
• Tospitimou - One of Greece's largest property portals, offering a wide range of residential and commercial properties exclusively listed by real estate agents.
• Property Portal - A platform to browse and publish residential, commercial, and agricultural properties in Romania and other regions.
• Romconsulting - A Romanian real estate agency with 20 years of experience, specializing in retail, corporate offices, and housing sales.
• Realestate.com.au - A comprehensive property portal featuring residential and commercial properties in Romania and worldwide.

Also, know that we have included contacts of real estate agencies, property lawyers, moving companies, expats communities and more in our pack for buying property in Romania.

What you can get

As mentioned before, the average price per sqm in Bucharest is $2,630. A 1-bedroom property with 60 square meters of space would cost approximately $158,000, while a 2-bedroom with 85 square meters of space would be around $224,000.

However, the amount you pay for a property can be different based on its characteristics and where it's found.

Housing prices in the top areas of Bucharest are usually at a premium. An apartment in Primaverii might cost around $300,000, while a house in Herastrau could be priced at $460,000.

Still, some spots are more wallet-friendly. You may find an apartment in Titan for $90,000, or you might locate an apartment in Giulesti priced at only $70,000.

We give a more detailed breakdown in our full pack for buying property in Romania.

Risks and pitfalls

Here are the main pitfalls when buying property in Bucharest, Romania:

• Land Ownership Restrictions: Foreigners may face limitations on buying land, which can complicate property acquisition.
• Restitution Claims: Properties with unresolved historical restitution claims could lead to legal disputes.
• Communist-Era Property Issues: Some properties have unclear ownership titles due to historical property seizures during the communist era.
• Informal Construction: Be cautious of informal constructions that lack proper permits and may not meet safety standards.
• Infrastructure Development: Verify future infrastructure plans as nearby construction may affect property value and livability.
• Rising Maintenance Costs: Aging buildings may require costly maintenance and renovations in the long run.
• Property Scams: Beware of fraudulent sellers or agents selling properties that don't exist or have multiple claims.
• Zoning and Urban Planning: Familiarize yourself with zoning laws to ensure the property's intended use aligns with local regulations.

We don't want this to happen to you, so we have included a full checklist for your property investment in our pack of documents. Avoid these mistakes and save a lot of money.

Everything you need to know is included in our Romania Property Pack

Living in Bucharest

Living in Bucharest offers a unique blend of modern amenities and old-world charm, making it an ideal place for those looking to buy property.

Cost of living

The cost of living in Bucharest is relatively low compared to other European cities. It is possible to find affordable accommodation and food, and transportation is generally inexpensive.

Here are some examples to better understand the cost of living in Bucharest:

• Rent for a one-bedroom apartment in Old Town (city center): $500-$900 per month.
• Monthly utilities (electricity, water, heating): $100-$150.
• Mămăligă meal at a traditional Romanian restaurant: $7-$12.
• Monthly RATB public transportation pass: $25-$35.
• Gasoline (per liter) from OMV or Rompetrol: $1-$1.20.
• Monthly World Class gym membership: $40-$60.
• Internet from RCS&RDS (100 Mbps, unlimited data): $10-$20 per month.
• Movie ticket at Cinema City or Grand Cinema Digiplex: $6-$10.

Neighbourhoods

Since we like to make information easy to understand, we've created a summary table outlining the different neighborhoods in Bucharest. For yields, prices and rents, check our property pack.

Life in Bucharest

The economic landscape in Bucharest is largely driven by the service industry, which accounts for over 60% of the city's GDP. Additionally, Bucharest is home to a number of large multinational corporations, making it an important hub for trade and investment.

According to the IMF's data, Bucharest's GDP contributes to nearly 22% of Romania's GDP. When you buy in a city with a strong economy, your investment is generally considered safer and less susceptible to market fluctuations.

What expats usually like the most in Bucharest is the vibrant nightlife, with plenty of bars, clubs and restaurants to explore, as well as the city's rich cultural heritage with its many museums and galleries.

Another great point to note is that Bucharest is a safe city, with a crime index of only 28, which is a really good score. Most crimes are minor crimes.

A good point for a property investor - Bucharest has a mass rapid transit system, known as the Bucharest Metro, which consists of several lines and more than 60 stations.

Access to healthcare in Bucharest is good, with a Healthcare Index of 54. An effective healthcare infrastructure always boost the appeal of a place, which is good for real estate.

Don't lose money on your property in Bucharest

100% of people who have lost money in Romania have spent less than 1 hour researching the market. We have reviewed everything there is to know. Grab our guide now.

Download Now

Renting out in Bucharest

This section is for you if your goal is to buy a property and rent it out to generate income.

Long-term

Tenant Profiles in Bucharest

According to the data reported by Wikipedia, the home ownership rate in Romania is 95%, which is very high.

It is probably a bit less in Bucharest which is quite different from the rest of the country.

If you decide to buy and rent out to long-term tenants, you should target young professionals, expats, and students in Bucharest. Families with children may also be interested in renting in the city.

Here is a little summary table we've made for you.

Rental yields

Nowadays, rental yields in Bucharest are usually below 5%. It's not much. As you might know it already, a good rental yield generally falls within the range of 7% or more.

The best rental yields in Bucharest are typically found in properties located close to public transportation, universities, and/or business districts. These areas offer a high demand for rental properties due to their convenience and accessibility.

For further explanation and a more detailed breakdown, you can check the reports and analyses we have made.

Finally, be aware that rental incomes in Bucharest are taxed at 10%, which is very advantageous.

Short-term

You could also decide to rent short-term to business travelers, tourists, and students visiting Bucharest for a short period of time. Additionally, you could rent to locals looking for a short-term accommodation solution.

If you decide to go with that option, look for properties in the Old Town, University Square, and Victory Square areas of Bucharest. These areas are popular with tourists and offer a great opportunity for short-term rentals.

Currently, there are approximately 5,000 active Airbnb listings in Bucharest, reflecting a highly dynamic and bustling short-term rental market. The average daily rate is at $53.

You have the opportunity to generate a nice additional income stream then. According to online testimonials and analytics platform like AirDNA, Guesty and Inside Airbnb, people who offer short-term rentals in Bucharest can make around $800 per month. Also, the average occupancy rate is estimated at 67%.

Is it worth buying real estate in Bucharest then?

Buying a property in Bucharest can be a wise move if you're in it for the long haul. It's an attractive option for those seeking a stable investment with the potential for long-term financial security.

The property price-to-rent ratio in Bucharest is favorable, meaning it usually takes around 23 years of rental payments to buy a property. Plus, the city's real estate market is showing promise with a growing economy and GDP forecasts, which typically lead to higher property demand and prices.

Bucharest's property prices are significantly more affordable than in many other European cities, making it accessible for those looking to invest without breaking the bank.

However, if you're looking for quick profits or face legal restrictions as a foreigner, Bucharest might not be the right choice. Rental yields are generally lower than ideal for short-term or speculative investors. Foreigners should also be aware of land ownership limitations, and some properties may have unresolved historical restitution claims, potentially leading to legal complications.

Additionally, older buildings may require costly maintenance, and informal constructions may not meet safety standards. Overall, it's crucial to weigh your investment goals, risk tolerance, and legal considerations carefully before diving into the Bucharest property market. Consulting with a local real estate expert can provide valuable guidance to make an informed decision.

Make sure you understand the real estate market in Bucharest

Don't rush into buying the wrong property in Romania. Sit, relax and read our guide to avoid costly mistakes and make the best investment possible.

Download Now

The content provided here is for informational purposes only and does not imply endorsement or advice. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the content and analyses presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.