The residential market has a positive outlook this year, over favourable macroeconomic conditions and higher demand levels, especially expected to realise in H2 2024, according to a report by residential developer STC Partners.
The market is set to benefit from a combination of factors including declining inflation rates, anticipated decreases in central bank interest rates, continued availability of attractive mortgage financing options, and redirection of available savings towards real estate investments.
The residential segment should recover after the transaction volume was hit last year by the high inflation and increased mortgage costs.
"Despite a challenging start, the residential market demonstrated robust resilience throughout 2023. The second half of the year marked a significant increase in transactions, supported among others by factors such as increased buyer confidence and attractive financing options. Another provoking factor was also determined by the fact that real estate lost ground in 2023 to other types of investments, such as bank deposits or government bonds, but 2024 promises a considerable recovery from this point of view as well," said Andrei Ștefan, Partner at STC Partners.
The report notes that the market is expected to witness higher transactional activity this year also considering the availability of some remaining properties for sale in certain submarkets, getting close to the record levels of the 2021-2022 period. Furthermore, price increases should catch up with the earnings growth and position above inflation.
