How much can you negotiate the price depending on the city? The lowest price trade-off and other trends in the residential market

Romanians want to be owners, and to achieve this goal some of them make considerable efforts. Negotiations done “in blood” or the temptation to compromise on the lowest price are some of the aspects they face in the process of purchasing a home.

Imobiliare.ro took a complete X-ray of the residential market in its latest market report and comes with first-ever details on the realities buyers should adjust their expectations to in order to truly make the best decisions.

How much can you negotiate the price depending on the city?

Bargaining for the best price is normal for buyers. It is important, however, that their expectations are realistic about the discounts they can get.

Owners and developers are not willing, most of the time, to make significant discounts, either because of their own costs or because they have a certain emotional attachment to the home in question. Of course, we are not talking here about special situations such as those where you want to speed up the sales process or those where we are discussing packages intended for investors, which include several properties.

The negotiation margin – calculated as the percentage difference between the transaction price and the buyer’s last asking price – is actually quite small in the country’s main cities. Owners from Brașov and Iași, for example, are less willing to let the price go than those from Cluj-Napoca or Timișoara. If in the first cities we are talking about a negotiation margin of 2.4%, in the two large regional centers in the west of the country it reaches 3.5%, according to the data analyzed by Imobiliare.ro.

On the Bucharest residential market, at the beginning of this year we find a negotiation margin of 3.9%, while in the case of owners in Constanța, we notice that it reaches the highest level among the big cities, at 4.2%.

The lowest price compromise. Cheap and good does not exist in real estate

Buyer interest remains at a good level at the beginning of this year, but the supply of houses and apartments available on the market is limited. If we take into account the current conditions on the credit market and the favorable medium-term outlook for it, we can say that we can expect to see further increases in house prices in the coming period.

In the first quarter of 2024 it was already visible an advance of about 8% in of the national average asking price for residential propertiesif we refer to the similar interval from 2023, up to the value of 1,563 euros/useful square meter.

The most expensive city for shoppers is Cluj-Napoca. Here, the average asking price for homes for sale reached 2,631 euros/useful square meter in the first trimester. Brasov ranks second in the national ranking with an average of 1,789 euros/useful square meterwhile Bucharest is only in fifth place with 1,578 euros/usable square meter.

“With the return of demand, real estate prices are increasing. Moreover, additional pressure is generated by the decrease in supply, which not only can, but certainly will put pressure on pricesespecially that the long-awaited moment of interest rate cuts is near. These things, coupled with the unbridled appetite for ownership, risks further keeping uneducated buyers in the zone of compromise developments – at the level of quality, location, surfaces – and of peripheral projects, many and cheap, whose value will not only not increase over time, but will remain absolutely ridiculous. Beware of the price compromise! The capital is full of such examples which, by the way, largely explains why Bucharest is overtaken by Cluj-Napoca, Brașov and soon by all the secondary cities, although it has entire neighborhoods with an average price of almost 3,000 euros/sqm” , said Daniel Crainic, Imobiliare.ro marketing director.

What are buyers looking for? The main trends in the residential market

In the first three months of this year many of the buyers turned their attention, as a priority, to new homes, completed starting in 2020, according to Imobiliare.ro data. However, the old market is gaining ground in many of the big cities.

For every old house in Bucharest or apartment located in a building built before 2020 there were two potential buyers in the market, while for each new home in Constant four potential buyers have shown interest.

The only big city where the offer for sale has increased at the beginning of the year it was Brasov. Buyers had a choice of 6,100 houses and apartments, 2% more compared to the beginning of last year. At the opposite pole was the Capital, where the supply of housing decreased by almost 20%. Even under these conditions, Bucharest has no rival at the national level. From a total of 88,900 houses and apartments listed for sale in the six largest cities in the country, more than half were in the Capital.

An increase of 5.2% could also be observed in real estate transactions. Between January and March, they sold out nationwide nearly 145,500 houses, plots and apartments, according to the data of the National Cadastre and Real Estate Advertising Agency. A spectacular evolution was registered in the case of the county IASI where almost 7,600 properties were sold, a fact that helped it surpass Timiș, Brașov, Cluj and Constanța.

Longest selling period was registered, in the case of apartments, in Cluj-Napoca and in Constant, according to Imobiliare.ro data. The dwellings of Timisoara they most quickly found buyers at the beginning of this year.

Find more details about the evolution of the sales segment, but also about the one related to housing rentals in the latest report Imobiliare.ro Market 360 “Residential real estate market, Q1 2024“.

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