Angela Matkov
According to her, the real estate market in Chisinau is imperfect, characterized by unique properties and relatively high prices, which limits the number of buyers and sellers. In addition, the lack of available information for all market participants makes investment decisions rather intuitive. Supply growth after the exhaustion of the existing real estate stock depends on urban planning regulations, availability of land plots and the ability of developers to mobilize the necessary resources for construction.
Thus, supply and demand in the real estate market are rarely, if ever, in equilibrium. Usually over a long period of time, demand remains high and supply insufficient as the construction industry fails to respond to this growth in a timely manner, resulting in high prices. This phenomenon was observed in 2023-2024 and will continue in 2025. And after the phase of high demand comes the phase of “oversupply”, which is inevitably accompanied by recession and, consequently, a decline in prices. This cycle repeats with a periodicity of 12-15 years.
“The residential real estate market in Chisinau, like any other commodity market, is influenced by the moods, motivations and interactions of all its participants. Among which, in addition to buyers and sellers, there are also state authorities, financial institutions, developers, real estate agents, each of which is guided by its own interests,” says Angela Matkov. – The current state of the market and the prospects for the next two to three years can be explained by scrutinizing the key factors influencing the mood and motivation of all its participants”.
Analyzing these factors also helps to distinguish between trends caused by “marketing techniques” and the real situation confirmed by statistical data from government agencies. Of course, these data need some adjustment based on the information collected in the field.
The price growth in the residential real estate market was caused by both internal and external factors. The internal ones include the growth in the level of official incomes, relatively stable remittances (about $1.6 billion) and the perception of residential real estate investment as the best investment option for individuals. This is due to the limited size of the capital market and, until recently, low interest in purchasing government securities.
Demand was supported by internal labor migration, as well as the influx of young people to study and find better-paid jobs in the capital. Lower inflation and the attractiveness of credit products to finance real estate purchases after a period of stagnation in 2020-2023 played their role. Apartments in Chisinau, starting from 2023, were also actively bought by foreign citizens, including citizens of Ukraine and the Russian Federation.
The growing demand stimulated the development of the housing construction sector. During 2022-2024, 211 permits were issued for the construction of apartment buildings in Chisinau municipality (70 in 2022, 55 in 2023 and 86 in 2024).
“In this context, it is expected that in the period 2026-2028, the stock of apartments on the residential real estate market of Chisinau mun. The stock of apartments on the Chisinau mun. real estate market is expected to increase considerably, while no significant reasons for demand growth are foreseen,” says Angela Matkov. – At the same time, it should be taken into account that the availability and cost of labor in the construction sector is a priority problem for developers, which may affect the timing of commissioning of buildings”.
She notes that currently on the market of multifamily housing stock in Chisinau about 13-15% of housing remain unoccupied. First of all – due to overpricing. These data are confirmed by the analysis of real estate platforms and verified by data from developers. This figure refers to the average price segment of housing (excluding elite objects and old buildings with low standards, small area or converted apartments). At the same time, it indicates the end of the unsatisfied demand phase and the approaching “oversupply” stage, when the number of empty residential spaces will increase and prices will start to decline after a moderate growth.
According to the expert, some investors may choose the strategy of “buy and wait”. But the rule “a dollar today is more valuable than a dollar tomorrow” will correct their behavior and lead to a reasonable decline in prices. At the moment there is a softening effect on the market, which allows to keep sales activity longer, due to the significant gap between the cost of construction of 1 sq. m. (650 euros) and the sale price (about 1000-1300 euros).
Angela Matkov believes that in order to correct the consequences caused by the imperfections of the real estate market, certain measures should be taken by the state. In particular, to protect the socially vulnerable, especially those who want to buy housing rather than invest in real estate for profit.
Also, the public sector could correct information asymmetry by opening up more data to the public, such as real transaction prices, urban development plans, etc., to the public. Promote financial literacy among citizens to diversify their investment portfolio by selling government bonds, municipal loans and other financial instruments. Provide support for the construction sector by encouraging investment beyond the capital to other regions of the country. As well as segments of the real estate market that are in the recovery stage, but where demand is growing with low supply (such as commercial real estate).
