Moldova's Housing Boom: Demand Soars for New Apartments
Despite persistent high prices for new apartments, demand has surged by roughly 10% this year, according to real estate experts.
They anticipate a significant increase in market supply over the coming years, which should help alleviate the strong demand for housing. Notably, buyers are gravitating towards peripheral areas rather than suburbs due to the more developed infrastructure in these locations. However, economic analysts warn of a potential deficit in new apartments throughout 2024.
Peripheral Areas Attract Buyers
A recent interview with Victor Romanescu, a real estate expert, on Radio Moldova revealed that apartments in peripheral areas are experiencing the highest demand, surpassing even those in suburbs. This trend is attributed to the superior infrastructure found in these peripheral zones. Romanescu also predicts a rise in market supply in the coming years, driven by the construction of new apartment blocks, especially on the outskirts of the city.
"We're witnessing a return to pre-pandemic market volumes when loan rates were lower, and clients had more buying power," explained Romanescu. He further noted that new apartment blocks are primarily viewed as investment opportunities for rental income rather than personal residences. "For those seeking new apartments, less central locations are often the preferred choice, essentially functioning as an alternative to traditional bank deposits," he elaborated.
Demand Remains Steady, Prices Stay High
Another real estate specialist, Victor Cernomorcenco, spoke to Radio Moldova about the consistent demand for apartments, particularly in Chisinau, the capital city. However, he acknowledged that potential buyers are hesitant due to the high prices. Cernomorcenco pointed out that several new apartment blocks are currently under construction and will be available within the next two years. He emphasised that interest in this type of housing will likely continue to grow.
"There is undeniable demand, though it's not exceptionally high," Cernomorcenco said. "Buyers are more selective in their choices, carefully considering factors like the apartment itself, its location, and the overall quality of the building, especially given the current high prices." The average price per square metre for a new apartment in Chisinau is approximately 1,250-1,290 euros, according to Cernomorcenco. He added that there's strong buyer interest in both unfinished apartments (still under construction) and those already completed, including both unfurnished and renovated options.
"Over the past two decades, Moldova has witnessed a steady pace of construction, but not at a rate that can keep up with the ever-growing demand," Cernomorcenco continued. "People are constantly seeking to improve their living conditions. This includes those relocating from districts to Chisinau who specifically target new apartments, as well as existing residents in older buildings seeking more spacious accommodations."
Supply Concerns Linger
Veaceslav Ioniță, an economic expert, expressed concerns regarding a potential deficit in new apartments throughout 2024 due to the high demand and a stagnant construction sector. "The moderation in housing price increases combined with the recent decrease in loan rates, which had risen last year, has stimulated the furniture market," Ioniță explained. "Construction activity for new apartments has been rather low in recent years, with major projects only slated to launch in 2025 or 2026. In 2024, we can expect to see a supply that falls short of what many citizens desire."
Ioniță also highlighted that Chisinau experienced its peak construction period for apartments during the 1990s, with an average of roughly 8,000 units built annually. This period was subsequently followed by a stagnation in construction.
Translation by Iurie Tataru
