Reasons to Rethink Romania for Property Investment

There would appear to be a distinct division of opinion with regards to property investment in Eastern Europe at the moment with the bulls and the bears going head to head and challenging opinions about the potential for sustainable growth in the markets of Latvia, Estonia, Bulgaria and Romania for example.  Whilst it is pretty obvious for anyone to see that Latvia’s bubble is about to burst, the picture is less clear when you focus on Romania.

Romania’s star has not shone as brightly as others in this region and so some believe that there is ongoing potential to profit from various investment strategies in Romania’s property markets – others are choosing to bank on IMF’s Albert Jaeger’s findings – he believes that with Romania’s economy having expanded by 5.6% in Q2 2007, there are signs that it could now overheat.  Personally we think there are reasons to rethink Romania for property investment.

Unlike Bulgaria which has relied heavily on either its summer sun or winter sports appeal for tourism based buy-in strategies for seasonal yield or potential resale profitability, Romania’s real estate successes have been based within the city of Bucharest and on targeting domestic rental and resale demand.  There is actually no denying the fundamentals upon which interest and potential in Bucharest is built and therefore we are still pretty positive about the Bucharest property market and it seems we are not alone.

Back in 2006 prior to the nation’s acceptance for EU accession, PricewaterhouseCoopers placed Romania in the number one spot in their list of locations on target for the most impressive property price gains over the next decade.  The world’s largest professional services firm predicted that a quadrupling of prices was possible in Romania.  Their predictions have been reiterated recently with a survey commissioned by The Telegraph newspaper and carried out by Knight Frank specifically placing Bucharest in the number one spot out of all European cities presenting strong property price appreciation potential over the coming 10 years.

Domestically speaking, the most wealthy Romanian’s reside in Bucharest…there is also a growing base of middle class, middle income individuals who have increased access to mortgage financing, who have an advancing disposable income, an almost insatiable demand for quality, new and modern real estate and who are providing property investors who commit to Romania with a secure exit strategy.  This level of demand is one half of the equation upon which the likes of Knight Frank have based their due diligence when it comes to determining the profitability potential of an investment strategy specifically targeting property investment purchases in Bucharest. 

The other half is rental demand – this comes from the fact that Bucharest is the number one city in the nation for commercial activity.  It is the main economic centre for the nation, it is advancing in terms of employment prospects, incomes, productivity and ultimately demand for property, and according to Jones Lang LaSalle, the city’s economy achieved in excess of a 9% growth in GDP in 2006 resulting in Bucharest being Europe’s fastest growing city economy speaking.  Going forward, the global real estate experts predict an 8.4% per year on year growth over the next five years based on rising levels on inward investment, strong export growth and an already witnessed expansion in consumer consumption.

We believe that Bucharest offers those seeking property in Romania for investment purposes the best chance of achieving the strongest yields, the most reliable exit strategies and the longest term property price appreciation potential.

Special Reports: Property News for Romania

Romania Property Buying Process
After Romania joins the EU in 2007 its property buying process will become simplified

Romania Property Investment Potential
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Romania Property Investor’s Introductory Guide
The real estate market in Romania is in its infancy but offers property investors stunning property at incredibly affordable prices.