The number of apartment transactions in Romania declined by nearly 9% in the first four months of 2025 compared to the same period in 2024, according to data from Colliers. In Bucharest, the decrease was more pronounced at 12%. Tighter access to financing, economic uncertainty, and rising construction costs contributed to the slower activity in the residential market. Several factors have combined to impact buyer confidence and purchasing power. According to Gabriel Blăniță, Associate Director for Valuation & Advisory Services at Colliers Romania, a slowdown in the labor market, moderate wage growth, political uncertainties tied to the electoral cycle, and continued increases in housing prices have created difficult conditions for transactions. Access to mortgage financing has become more limited due to persistent inflation and economic instability. The removal of certain tax incentives at the start of 2025 has raised labor costs for developers, further increasing housing prices. Additionally, a shortage of construction workers, exacerbated by ongoing infrastructure projects, is becoming more evident. After a 20% drop in housing deliveries in Bucharest during 2024, 2025 has not shown clear signs of recovery. Although construction activity rose by 9% in the first quarter, the volume of housing completions is not expected to return to previous levels in the near term. Despite these challenges, interest in homeownership remains high. Surveys by Eurostat indicate that demand for housing is approaching record levels. However, purchasing a home has become more complex, especially for buyers reliant on credit. Inflation, elevated financing costs, and potential fiscal measures aimed at reducing the budget deficit are affecting affordability. Colliers consultants anticipate that inflation will stay high in the medium term, which could limit the central bank’s ability to ease monetary policy. Fiscal adjustments to address the budget deficit may also indirectly affect the housing market. As a result, 2025 is expected to remain challenging for buyers. High financing costs are influencing not only demand but also developers’ willingness to launch new projects, particularly in the mid-market segment. In this environment, the rental market is gaining importance. In Bucharest, about 15% of residents live in rental housing, a figure that could rise as renting becomes a more accessible option for those unable to secure mortgage financing. Although this percentage remains below the European average, affordability pressures and a shortage of new supply in central areas are likely to drive further growth in rental demand. Looking ahead, Colliers notes that the residential market’s performance will depend on monetary and fiscal policies, labor market conditions, and how developers adapt to changing cost structures and demand patterns. While transaction volumes are adjusting, interest in urban housing remains steady, suggesting that market activity will continue at a more moderate pace with increased attention to efficiency and affordability.