Romania's Parliament unanimously passed Law 207/2025 in November 2025. It came into force on 11 December 2025.
Reservation fees are capped at 5% for up to 60 days. If the developer fails to honour it, a full refund is due within 30 days.
A further 25% at most once the structure is complete, up to 20% once the systems are in, and the balance near completion.
Using buyers' money for anything other than construction can bring fines of up to 1% of the developer's turnover.
Banks already require 30% to 40% developer equity for project financing. With the new law, weak players are pushed out.
Israeli investors are no longer chasing a "big score" – they are looking for certainty. The Nordis Law is turning Romania from a risky market into one where your money is protected, your rights are registered, and risk is finally managed.
2026 is not an easy year for Israeli investors. Inflation refuses to ease, the cost of living keeps squeezing, home prices have still not come down despite all the promises, and the 8% purchase tax on a second home (under the temporary provision extended by the Israel Tax Authority until the end of 2026) makes investing in local property a particularly expensive proposition. Against this backdrop, more and more Israeli investors are lifting their heads and looking beyond the border, as an ynet report by Hila Tzion (in Hebrew) described – and with good reason.
But let's be honest: for many Israelis, the phrase "property abroad" has an unpleasant ring to it. Years of headlines about fraud, about projects abandoned halfway, about money that vanished and never came back – all of these have left scars. The Israeli investor of 2026 is no longer chasing promises. He is chasing security.
And it is precisely here that Romania emerges as a surprising story.
The law that changes the rules of the game
In November 2025, the Romanian Parliament unanimously passed Law 207/2025, known as the "Nordis Law" – named after the major real estate scandal that exposed the market's failings. The law came into force on 11 December 2025 and represents the most significant reform of Romanian real estate law in recent years.
What the law does is simple, yet dramatic: it protects your money.
Here are its core principles, as set out in the law itself and confirmed by leading Romanian law firms (Hațegan Attorneys, TPA Romania, Pavel Mărgărit & Associates).
Deposit capped at just 5%. The law stipulates that the reservation fee may not exceed 5% of the property's value. The reservation agreement is limited to 60 days, at the end of which a binding preliminary contract must be signed. If the developer fails to honour its commitment, it must refund the full amount within 30 days.
Buyers' money is locked in a dedicated bank account. Beyond the deposit, all advance payments are paid into a separate bank account used exclusively for the project, and the funds are released only to pay for actual construction work. Using the money for any other purpose is strictly prohibited and may result in fines of up to 1% of the developer's turnover.
Payments are released only as construction progresses. The law sets out a clear schedule for releasing funds to the developer: up to a further 25% once the building's structure is complete, up to a further 20% once the building systems are complete, and the balance only as the project nears completion. The developer does not see a single cent before there is proven progress on site.
Mandatory land-registry entry and a buyer's caveat as early as the preliminary contract. Every residential unit must be registered as a separate unit in the land register before a preliminary contract can be signed, and at the same time a caveat is registered in the buyer's favour. This prevents the once-common practice of developers selling the same property to several buyers, and ensures that the buyer's rights are legally protected from the moment the preliminary contract is signed.
A "death certificate" for speculative developers
The law's most significant consequence is not only buyer protection, but a dramatic weeding-out of the developers themselves.
In the past, small developers in Romania could collect large deposits from buyers purchasing off-plan and use the money to fund other projects, buy land or cover debts. Without realising it, the client became the developer's main source of financing – and carried all the risk.
The Nordis Law shuts off that tap. When a developer can no longer rely on clients' money as its main source of funding, it has to bring its own capital. According to an analysis by North Bucharest Investments published in Romania Insider, the Romanian banking system already requires developers to show equity in the range of 30%–40% (land + capital + deposits) as a condition for project financing. Combined with the restrictions of the Nordis Law, the outcome is clear: small companies and developers without strong financial backing simply can no longer operate in the market.
You may pay more than a few years ago, but you are buying certainty that the home will be built and registered in your name.
What does this mean for investors? The only players left on the field are those with real capital, a proven track record and the ability to finish a project. The fly-by-night operators – Israeli and local alike – who ran their businesses on hot air and hope are effectively receiving a professional death certificate.
The risk premium is plunging – and attracting new investors
In economics, security comes at a price. The new requirements increase construction costs and delay some projects, which reduces supply and affects prices. According to data from Imobiliare.ro and Global Property Guide, apartment prices in Bucharest kept rising during 2025, against a backdrop of strong demand and limited supply.
But there is an important point hidden here: the price increase reflects a sharp fall in the risk premium. When your money is protected at the bank, when the property is entered in the land register even before the preliminary contract is signed, and when the developer is bound to meet proven milestones, the risk of losing your investment drops significantly.
This reduction in risk is a powerful magnet. It draws investors into the market who would never have entered Eastern Europe before: conservative investors, institutional investors, and people who are looking first and foremost for peace of mind.
The equation is clear: you may pay more than you would have a few years ago, but you are buying security – the absolute certainty that the apartment will be built and registered in your name.
A comparison that speaks for itself
Let's put the facts on the table:
Rental demand: Bucharest enjoys steady rental demand from professionals, young families and employees of international tech companies, alongside an ongoing shortage of new homes.
Entry taxes: Buying a second home in Israel incurs an 8% purchase tax from the very first shekel (a temporary provision extended until the end of 2026). In Romania, purchase taxes are significantly lower, and buying a property in Romania does not affect your "single home" status in Israel.
Financing: Banks in Romania grant euro mortgages to foreign buyers too, so you can plan the purchase around a fixed monthly payment known in advance.
When you combine these advantages with the safety net of the Nordis Law, you get a formula that did not exist before: an emerging market with real demand and the consumer protection of a Western European one.
Pipera Tech Park, Romania
What does all this mean in practice?
- The era of "gambling" on Romanian real estate is over. The new law does not just protect buyers – it changes the structure of the entire market.
The projects now coming to market are capital-backed, with proven developers and realistic timelines. There may be fewer new projects, but those that do get off the ground are being built in a more regulated and safer environment than ever before.
The Israeli investor arriving today is entering a market fundamentally different from the one that existed five years ago. He no longer has to pray that the developer will finish construction – there is a supervision and payment mechanism that ensures it. He no longer has to fear that his money will be used for other purposes – the law forbids it. And he no longer has to worry that the property will not be registered in his name – the land-registry entry and the caveat are made as early as the preliminary contract stage.
Frequently asked questions
When did the Nordis Law come into force?
The Romanian Parliament unanimously passed Law 207/2025 in November 2025, and it came into force on 11 December 2025. It is named after the major real estate scandal that exposed the market's failings, and it is the most significant reform of Romanian real estate law in recent years.
What happens to my reservation fee if the developer fails to deliver?
The reservation fee is capped at 5% of the property's value, and the reservation agreement is limited to 60 days, after which a binding preliminary contract must be signed. If the developer fails to honour its commitment, it must refund the full amount within 30 days.
When does the developer receive the buyers' money?
Payments go into a bank account dedicated to the project and are released as construction progresses: up to a further 25% when the structure is complete, up to a further 20% when the building systems are complete, and the balance as the project nears completion. Using the money for anything else can bring fines of up to 1% of the developer's turnover.
How does the law stop an apartment from being sold twice?
Every residential unit must be registered as a separate unit in the land register before a preliminary contract can be signed, and a caveat is registered in the buyer's favour at the same time. Your rights are legally protected from the moment you sign the preliminary contract.
Which developers remain in the market after the law?
Romanian banks already require developers to show 30%–40% equity as a condition for project financing, so combined with the new restrictions, mainly developers with real capital, a proven track record and the ability to finish a project remain. Before signing, ask the developer about its equity and the projects it has completed.
The bottom line
The Nordis Law is not just another technical reform. It marks a shift in mindset for the Romanian property market – a move from the Wild West to a regulated, transparent and supervised market. For the conservative Israeli investor who has been burned by empty promises in the past, this is exactly what he has been looking for: a place where the money is protected and the rights are guaranteed.
True, the price of security shows up as slightly higher entry costs than in the past. But from a risk-management perspective, paying for peace of mind and guaranteed land-registry entry is the wisest decision an investor can make in 2026.
This article is intended for general information purposes only and does not constitute tax, legal or financial advice.
Before entering into any transaction, we recommend consulting local experts.
Now you know more.
This article is general information, not legal, tax or financial advice. Consult local professionals before any transaction.
