The average price of a three-room apartment in Bucharest has doubled in the last two years, a survey by ZIARUL FINANCIAR has found. The findings were based on ads published in the largest specialised publication in Romania, Anunt de la A la Z ("Ads from A to Z"), which publishes about 8,000 ads for sales of flats in its weekly issues.
There is no official flat or home price index on the Romanian market, just opinions of analysts or representatives of real estate agencies. Many agencies expected prices of apartments built before 1989 to stagnate or even go down last year, when they actually continued to rise by 20 to 50%.
The ads analysed were published on March 15, 2004, March 15, 2005, March 15, 2006 and June 12, 2006. Only those that mentioned the year when the building was erected and the surface area (to achieve an accurate comparison over time) were chosen. This makes about 80 ads per issue out of the some 2,000 posted for three-room flats.
The three-room reference was chosen because it is less likely to fall under the influence of speculators or of small real estate investors, which focus on studios and two-room flats for rental purposes.
The research took into account the asking prices of the sellers and the real estate agencies. The prices of the transactions are usually 5 to 10% lower than published in the ads, but the trend over time remains valid. A seller is now asking 1,090 euros per square metre of a three-room flat built between 1980-1990, compared with 535 euros in March 2004.
In only two years, the prices on the real estate market have doubled. Therefore an 80 square metre three-room flat now costs at least 87,200 euros, 44,000 euros more than it cost two years ago.
The sharpest rise in flat prices occurred in 2005, when prices rose by 65% in March 2005 in comparison to the same month of 2004. This increase equates to the price of one square metre rising from 535 euros to 887 euros.
The increases in March 2006 compared with March 2005 were not as spectacular, but buyers paid for delaying the purchase of the flat by one year: 138 euros were added per square metre, up to 1,025 euros. A further 6% increase added to the price of a flat from March through June, to the 15% increase from March 2005 through March 2006. In only three moths, the price per square metre rose by 66 euros on the average, to 1,091 euros.
A 70 square metre three-room flat now goes for 76,370 euros, compared with 71,750 euros in March this year. The increases over the three months are related to location. For instance, one square metre became 31% more expensive in the 1 Decembrie area (close to Piata Unirii, prime central area), compared with Basarabia Blvd, where the average square metre price remained constant or with Brancoveanu area, where the price witnessed a slight drop of 8%.
The price for a 70 sqm flat in the 1 Decembrie area (close to Piata Unirii), built in 1980, was 51,500 euros in March, while this month, a flat in the same area that is 4 square metres larger and was built in the same year costs 72,000 euros. At the same time, an 82 sqm flat in the 13 Septembrie area (Western Bucharest) that was built in 1989 sold for 73,000 euros in March and is now selling for 79,500 euros.
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