Real estate market trends in 2024

Where to invest in the new year, what to consider and how to find suitable offers so as not to make a mistake - Victor Romanescu, director of Romanescu&Co, will tell you about everything in a new article about what to buy in 2024.

The main reason why it is becoming increasingly difficult for Moldovans to be in trend with current prices is the banal law of the supply/demand market. Today there is less construction in Chisinau than in previous years, and there may be more potential buyers for an apartment in a new building. Therefore, the seller, often driven by the fear of missing out on big profits, raises the price. Owners of apartments in old buildings always follow trends in the primary apartment market.

Advice for Buyers in 2024

• Explore the suburbs and peripheral areas of the city - you can buy apartments there for up to 900 euros per m²;

• Contact your mortgage broker to find out the terms and conditions of obtaining a mortgage program. A mortgage is the best solution if you want to buy an apartment and you don’t have all the money. You pay a monthly fee as for rent, it is approximately the same price, but the apartment increases in value and remains your property; when you pay off all obligations to the bank, you will have property left, which gives you more confidence in the future;

• We recommend that investors reconsider their strategies and try to diversify their portfolio: invest in commercial premises, standard units, land, parking lots, hangars.

• The apartment market in Chisinau has created a situation where many are eager to make speculative investments, and often this desire causes prices to rise because sellers see increased interest in their property. Alternative investment methods often provide higher returns on your money.

In this context, how can one find a suitable property at a reasonable price?

Tips for buyers to find the property they want

• Browse the list of real estate agencies in Chisinau based on reviews or recommendations from friends;

• Select the agency you want to work with and request qualified advice from a real estate agent;

• Often good properties do not appear for sale on the Internet and are sold internally. Therefore, it is recommended to be on the list of those agents will contact when a suitable target becomes available.

To date, there are about 23,000 advertisements on advertising portals, many of which are on the market at inflated prices and are of no interest to buyers. Searching using this method is often unsuccessful.

Forecasts for 2024

Next year we predict an increase in activity in the real estate market due to the constant decline in mortgage rates.This year, the National Bank reduced the main rate twice: on June 20 it was 6.00%, and on November 7 it dropped to 4.75%.

As a result of these changes, the number of mortgage applications has risen sharply. For example, in August 2023, the volume of new mortgage loans was 61.4% (!) more than in July 2023, amounting to about 21.2 million euros. This is a clear sign that many more families are ready to change their living conditions.

Will there be further price increases?

There are no signs that prices will plateau in 2024. Several signs in the market contribute to this:

• increased demand for rental projects with investment potential,

• limited supply on the secondary market (buying a one-room apartment in an old house is a real pain),

• a negative information climate, forcing many families not to sell their apartments, and, consequently, the supply is constantly decreasing.

Should you buy now or wait?

Whatever position you are in - an investor or a final buyer, you must consider several factors:

• Cash is constantly depreciating compared to the value of m²;

• Economic growth of the entire southeastern region is inevitable after the end of the war in Ukraine, which will obviously push the real estate market upward;

• All companies that will begin construction in 2024 are planning prices of 1,000 euros and above at the foundation stage;

• Mortgage interest rates have been steadily falling, and in 2024-2025 we expect that we will return to 2020-2021 values, which will also push the property market up.

What interesting projects do you recommend for investment?

All real estate projects increase in price from the foundation stage to commissioning. The difference is the level of risk you take and how much the price will rise. To choose the right option, consult with a new unit sales agency, but be sure to check customer reviews before doing so.

Can we invest abroad?

The place most suitable for Moldovans in the field of real estate is Romania. Several factors contribute to this:

• similar legal system

• similar purchasing procedures,

• identical language, proximity to your location,

• autonomy in actions and complete control over them on your part, etc.

Romanescu&Co recommends investing in Brasov.

This city attracts a lot of non-refundable European funds for the development of social infrastructure. According to information from economedia.ro, Brasov's local budget for 2023 had the largest amounts ever raised from European funds. Projects that have received European funding and are underway in 2023 include the construction of six kindergartens and four nurseries, the installation of electric vehicle charging stations, the expansion of an information-based public transport management system, the reconstruction and modernization of several schools, and the construction of the first solar park in Brasov. Moreover, apartments in Brasov are successfully rented out both in a hotel and for a long term.

The city is home to Transylvania University, which has approximately 20,000 students. According to statistics for 2023, the Brasov district accommodates approximately 1.2 million tourists. In addition, Brasov is a magnet for the border regions in terms of labor due to the large number of companies that have opened their offices and production facilities there. According to statistics, approximately 145,000 people are officially employed in the Brasov district, and some companies in the top 10 have 5,000 employees each.

Conclusion:

Tips for buyers:

• Explore the suburbs and peripheral areas where you can find apartments starting from 900 euros per square meter;

• Contact a mortgage broker to understand the terms of a favorable mortgage program;

• Diversify your investment portfolio with commercial properties, apartment buildings, land or parking lots.

About the price increase:

• Activity in the real estate market is forecast to increase in 2024 thanks to lower mortgage rates.

Tips for finding the property you want:

• Browse the list of real estate agencies based on reviews and recommendations;

• Agencies can provide access to exclusive offers.