In February 1990 Decree-Law 61/1990 opened the sale of state flats to the population, and in 1992 Law 85/1992 widened it, including by instalments.
According to National Institute of Statistics figures, average annual inflation in Romania reached 256.1% in 1993, after price liberalisation.
On 1 July 2005, under Law 348/2004, four zeros were knocked off the currency. In a contract from before July 2005, divide by 10,000.
According to the 2021 census, only 780 apartment buildings were built in Bucharest in the 1990s, against 9,622 in the 1960s. Most of the city predates 1990.
69,841 of the 155,212 residential buildings in Ilfov, the county around Bucharest, were built between 2001 and 2021. That is where new building moved.
1989 and the move to a market: the short answer
In 1990 Romania began selling the flats the state had built to the people living in them. Within a few years, many state tenants had become owners. In the same decade they lived through inflation that reached 256% in a single year, the privatisation of factories through vouchers, and a long economic slump. The 2000s brought NATO, the European Union and a credit and construction boom, and 2008 brought the crash.
What all this left in Bucharest's housing market is a very old stock. According to the 2021 census, most of the city's apartment buildings were built before 1990, and in the first decade after the revolution fewer blocks were built there than in any decade since 1960. New construction later moved outwards, to Ilfov.
Put simply: most flats in Bucharest were built by a state that no longer exists and sold to their tenants under 1990s rules. If you buy one, you also buy its history, and you check it.
Timeline: 20 years that built the market
| When | What happened | Source |
|---|---|---|
| 7 February 1990 | Decree-Law 61/1990: sale of dwellings built from state funds to the population | Decree-Law 61/1990 (Romanian) |
| 1991 | Law 58/1991 on the privatisation of companies: ownership certificates for citizens | Law 55/1995, which refers to it (Romanian) |
| 22 July 1992 | Law 85/1992 widens the sale of flats to tenants, including by instalments | Law 85/1992 (Romanian) |
| November 1992 to 1993 | Price liberalisation. Average annual inflation reaches 256.1% in 1993 | Britannica, ZF citing INS (Romanian) |
| 15 June 1995 | Law 55/1995: "mass privatisation", personal privatisation vouchers | Law 55/1995 (Romanian) |
| March 2004 | Romania joins NATO | Britannica |
| 1 July 2005 | The "heavy leu": 10,000 old lei become 1 new leu | Law 348/2004 (Romanian) |
| 1 January 2007 | Romania joins the European Union | European Union |
| 2009 | A €20 billion emergency loan from the EU, the IMF and the World Bank. And in May: the "Prima Casă" programme | Britannica, OUG 60/2009 (Romanian) |
| 2010 | VAT rises to 24%, and public sector pay is cut by a quarter | Britannica |
1990: the flat you got from the state
To understand Romania's housing market, you have to start with the tenant. Under communism, a large share of city dwellers lived in flats the state had built and rented to them. In February 1990, just weeks after Ceaușescu fell, Decree-Law 61/1990 opened the door: flats built from state funds could be sold to the population. In 1992 came Law 85/1992, which extended the sale to flats built from the funds of state enterprises and institutions, and allowed tenants to buy the flat they lived in, paying in full or by instalments.
The result is still visible in the data. According to Eurostat, in 2024 94% of people in Romania lived in a home they owned, the highest share in the European Union. Behind that figure stand, among other things, the contracts of the early 1990s.
For a buyer today, this is a very practical detail. In an old flat in a block, the chain of title may begin with a sale contract from the state from those years. Your notary and lawyer want to see it complete, from the first contract to today's extract.
The 1990s: factories, vouchers and inflation
Alongside the flats, the state also began to part with its factories. Law 58/1991 gave citizens ownership certificates, and in 1995 Law 55/1995 added personal "privatisation vouchers" for adult citizens. On paper, every Romanian became a shareholder. In practice, according to Britannica, little progress was made between 1991 and 1996 in solving the economic problems left by the old regime.
The big blow was inflation. In November 1992 the government liberalised prices, as recommended by the World Bank and the IMF. According to National Institute of Statistics figures published by Ziarul Financiar, average annual inflation was 170.2% in 1991, 210.4% in 1992 and 256.1% in 1993. In 1997 it jumped again, to 154.8%. Savings in lei were wiped out. According to Britannica, the economy contracted by more than 15% between 1996 and 2000.
What were people left with as the currency eroded? Many were left with the flat, an asset that did not vanish with the leu. That is my interpretation, not a statistic, but it helps explain why in Romania a home is seen as savings.
Those same years also saw the start of the restitution of nationalised land and houses, and that is where one of the most tangled conflicts in Romania's housing market began. Law 112/1995 provided that certain nationalised houses would be returned to their former owners, and allowed tenants living in other flats in such houses to buy them. Six years later came Law 10/2001, which made restitution in kind to former owners the general rule, with exceptions, among them houses already sold under Law 112/1995. The relationship between the two laws caused long legal disputes. According to the legal portal JURIDICE.ro, a sale to a tenant concluded before February 2001 can no longer be challenged, because the deadline for doing so passed in August 2002. For a later sale, you need to check that no restitution procedure is pending on the property.
In other words: a flat in an old house in central Bucharest can carry two stories, that of the tenant who bought it and that of the family it was taken from. The full story of nationalisation and restitution is in the third episode of the series.
The 2000s: NATO, the EU, and the heavy leu
At the start of the 21st century the picture turned around. According to Britannica, GDP began to grow, inflation fell and privatisation sped up. In March 2004 Romania joined NATO, and on 1 January 2007 the European Union.
Most flats in Bucharest were built by a state that no longer exists and sold to their tenants under 1990s rules.
Halfway there, on 1 July 2005, Romania knocked four zeros off its currency: under Law 348/2004, 10,000 old lei were exchanged for one new leu. Anyone reading a contract or extract from the 1990s today will see sums in millions of lei. These are not mistakes. They are old lei.
Foreign money arrived, credit flowed, and construction returned. Many Israelis came in those years too, mostly for land, and we have described what happened to them in our article on Israelis in Romania in 2007 to 2009.
2008 to 2010: the crash
The global crisis of late 2008 hit Romania hard. In 2009, according to Britannica, it received a €20 billion loan from the European Union, the IMF and the World Bank. The condition was austerity: in 2010 VAT was raised to 24% and public sector pay was cut by a quarter.
In that same year, 2009, the government launched "Prima Casă", a state-guaranteed mortgage scheme for first-time buyers, under emergency ordinance OUG 60/2009. In various forms, the scheme still shapes the housing market. And if you ask lawyer Ilan Leibovitch, he will explain why today's market is not a replay of 2008.
Why most Bucharest flats are old
Here are the numbers, from table 7.8 of the 2021 population and housing census. Bucharest has 27,450 apartment buildings:
| Period of construction | Apartment buildings in Bucharest |
|---|---|
| Before 1961 | 2,577 |
| 1961 to 1970 | 9,622 |
| 1971 to 1980 | 5,415 |
| 1981 to 1990 | 4,944 |
| 1991 to 2000 | 780 |
| 2001 to 2010 | 1,212 |
| 2011 to 2021 | 2,888 |
In other words, about 73% of Bucharest's blocks were built in the last three decades of communism. In the whole of the 1990s, 780 apartment buildings went up in the city, less than a tenth of what was built in the 1960s. Bear in mind that the census counts buildings, not flats, and a new building can be much larger than an old block.
And where is the growth? In Ilfov, the county around Bucharest. According to the same table, of Ilfov's 155,212 residential buildings, 69,841, about 45%, were built between 2001 and 2021. For individual houses the picture is even sharper: 62,427 of Ilfov's 142,867 individual houses were built in those years. That is where, in communes such as Balotești, many of the new homes around the capital are going up.
Something has moved in Bucharest itself too. Between 2011 and 2021, 2,888 apartment buildings went up in the city, more than in the previous 20 years combined. But set against almost 20,000 communist-era blocks, it is still small. If you buy an old flat in Bucharest, you are buying the majority. If you buy new, you are buying the minority, and usually outside the centre.
What this means for you as a buyer
- An old flat: a complete chain of title. Ask for all the contracts, from the first sale by the state to today, and a current land register extract. Our guide to the extract.
- A check for restitution claims. For a building or land that was nationalised, check there is no open claim. For a flat bought under Law 112/1995, check twice. Details in our article on checking claims.
- The year of construction sets the engineering check. How to read it, in the Ceaușescu episode and in our article on earthquake risk.
- Old sums in old lei. A contract from before July 2005 is denominated in old lei. Divide by 10,000.
- The lesson of 2008: buy registered, not promised. A property entered in the register, a building permit you can see, and a notarial contract. Why you see the permit before you pay.
- New build in Ilfov: check the plan. A planning certificate, the PUG and the PUZ, as we explain here.
- Financing. If you need a mortgage: financing of up to 70%, and equity of at least 30%. Details in our mortgage guide.
Frequently asked questions
How did Romanians come to own the state's flats?
Under Decree-Law 61/1990 of February 1990 and Law 85/1992, flats built from state funds were sold to the population, and tenants could buy the flat they lived in, paying in full or by instalments. That is one reason home ownership is so widespread in Romania.
How high was inflation in Romania in the 1990s?
According to National Institute of Statistics figures, average annual inflation reached 256.1% in 1993, after 170.2% in 1991 and 210.4% in 1992. In 1997 it jumped again to 154.8%. In 2005 four zeros were knocked off the leu.
Why are most apartment buildings in Bucharest old?
Because most were built by the state between 1961 and 1990: according to the 2021 census, 19,981 of 27,450 apartment buildings. In the 1990s construction almost stopped, and the new building of recent years has largely moved to Ilfov.
What did Romania do in the 2008 crisis?
In 2009 it received a €20 billion loan from the European Union, the IMF and the World Bank, and in return imposed austerity: 24% VAT and a cut of a quarter in public sector pay. The "Prima Casă" programme was also launched that year.
What is Law 112/1995, and why does it matter to a buyer?
It is the law that allowed tenants in nationalised houses to buy the flats they lived in, while other houses were returned to their former owners. Its relationship with the restitution law, Law 10/2001, caused long legal disputes, so for a flat like this an independent lawyer checks the building's legal history before you sign.
What do you check in an old Bucharest flat that was once sold by the state?
A complete chain of title from the first contract, a current land register extract, the absence of restitution claims, the year of construction and engineering condition, and the state of the owners' association. An independent lawyer goes through all of this before you sign.
The bottom line
In twenty years Romania went from a country where the state was the landlord to one where almost everyone is a homeowner. The road ran through inflation, privatisation, a boom and a crash, and it left Bucharest with an old housing stock and chains of title that begin in the 1990s. That is not a reason not to buy. It is a reason to know what to check.
If you are considering an old flat in Bucharest or a new house in Ilfov, book a half-hour call with me. Together we will build the list of checks that fits the property.
Moti Azulay, Compass Group Romania
Sources: Decree-Law 61/1990 (cdep.ro) (Romanian) · Law 112/1995, Article 9 (lege5.ro) (Romanian) · JURIDICE.ro: Law 112/1995 and buying a nationalised flat (Romanian) · Law 85/1992 (cdep.ro) (Romanian) · Law 55/1995 (cdep.ro) (Romanian) · Law 348/2004 (legislatie.just.ro) (Romanian) · OUG 60/2009 (legislatie.just.ro) (Romanian) · Britannica: Romania, the revolution of 1989 and after · Ziarul Financiar: consumer price index per INS (Romanian) · 2021 census, table 7.8 (Romanian) · Eurostat: 68% of people in EU households own their home · European Union: Romania
This article is general information only and is not legal, tax or financial advice. The historical account is based on the sources above, and the rules are correct as of 17 October 2026. Before you decide, consult an independent lawyer.
The series: a history lesson
- From Rome and Dacia: why Romanian is a Latin language
- Three principalities and two unions: 1859 and 1918
- Nationalisation and restitution: why land claims still exist
- The rise and fall of Ceaușescu
- 1989 and the move to a market economy (you are here)
- The EU and Schengen
- Faith, holidays and business
- The Jews of Romania and the bond with Israel
- Bucharest, "Little Paris"
Now you know more.
This article is general information, not legal, tax or financial advice. Consult local professionals before any transaction.
