Trends of institutional residential investments in a “super-homeownership” country [Enikő Vincze and Ioana Florea ]

Working paper presented at the EURS Seminar and Special Issue Institutional Investment in Urban Housing Markets: Global Trends, Local Manifestations and the State, 22-23 November 2023, Brussels

This article illustrates how institutional investors in real estate advanced in the context of a “super-homeownership” country, as Romania and other parts of Eastern Europe have been called (Florea et al. 2022). We trace the history of this “super-homeownership” housing regime and discuss its implications. We uncover how this housing system influenced the pace and strategies of institutional investors in urban housing markets and their advancement in interconnected markets such as office and retail. Through this entangled history of changing housing regimes and actors of the urban residential market, the transforming role of the state in ensuring spatiotemporal fixes for the global capital under “catching-up” pressures and narratives can be reflected upon. The findings are based on our research project, “Class Formation and Re-urbanization through Real Estate Development at an Eastern Periphery of Global Capitalism” (2021-2023). In its frame, we used secondary data analysis from reports of real estate consulting companies, the Romanian National Bank, and local governments; we analyzed materials on real estate and economic news platforms; we took interviews of diverse actors who are directly or indirectly involved into the real estate market (public authorities, real estate developers, brokers, and consultants).

Our case has the potential to bridge across theories of real estate/housing financialization (Aalbers 2017; Aalbers, Fernandez, and Wijburg 2020), uneven development and spatial fix (Smith 1990; Jessop 2004; Harvey 2001, 2005, 2019) and core-periphery relations (Wallerstein 1974; Kühn and Bernt 2013; Rodrigues, Santos and Telles 2016; Santos 2023). We explore this potential by focusing on the state’s role in forming and restructuring the housing market and the larger real estate market in the context of dismantling state socialism that created new spaces for the geographical expansion of capital from core capitalist countries. Thus, our article engages in theoretical debates by enquiring how the state facilitated the formation of the capitalist mode of housing and real estate production in an era of the globalization of the financialized accumulation regime and in a space pushed to “catch up” from a semi-peripheral status with the core capitalist countries.

The sections of the paper are:

Historical pathways and possibilities for the advancement of institutional investors

The legacy of a mixed housing system (1945-1989)

Manufacturing a market-dominated housing regime (1990s)

Housing as a financial asset in a super-homeownership country (2000s)

Increasing investment fever (2014-2020)

What comes next in rental housing