Hi from Romania

B

burnaby313

Guest
Folks, have a look at Romania as a potential investment.

Although originally from Greystones in Co. Wicklow, I've lived out here in Oradea NW Romania for the last 5 years and only 2 years ago started to buy property here.

If you are prudent then the risks are very small (always use a top-flite lawyer to check deeds, debts etc) and the returns are excellent. I'm getting between 10 & 13% rental return on my investments and a capital gain of about 15% per annum. So far I own 3 apartments a commercial complex and a site on which I've just recieved planning permission for an Hotel. I'd advise you all to mostly look at sites (you'll need to set up a holding company to do this! Easily done) or commercial properties. I'm going to finish the renovation of the apartments and off-load them. Better rental income on commercial. That said if you buy apartments well in the right location then you can do very well indeed. One of the first apartments I bought has appreciated by about 30% in 16 months!!!! And I did nothing to it except change the front door!

If anybody wants more information then I'd be glad to assist.

All the best from Eastern Europe!!

Scott
 
Hi Scott - Perhaps you could outline the tax impacts for Irish residents investing in Romania.
 
AFAIK Romania has practically 100% ownership at present as when the Communist government government fell all the state owned homes were either given to the tenants or sold to them for very low prices. Therefore I wonder is there a rental market in Romania or whether house prices will rise in the near future, perhaps the OP could comment?
 
I think the OP will assist us by selling us some property when we contact him :)
 
In my region there is a rental market albeit somewhat weak. It must be remembered that Romania, by and large, is a relatively poor country. Therefore the primary rental market for the foreign investor must be other foreigners. Here in the northwest of Romania that rental market is populated by Italians, Spaniards, Dutch, Austrians & Germans. So strong is the Italian community in this city that they even have, I am reliably informed, their own counsellor in the town hall!

Basically a shake-down of the numbers mean that if you buy a 2 bedroom apartment here for say 40 - 45k and do it up, another 4- 5k, then you can hope to rent it for somewhere between 300 & 400 Euro. This is not an unattractive return but the real gain is in the recent upsurge of Romanian property prices. It would, indeed, be difficult to find an apartment or house in this region, Bihor County, that hasn't appreciated by 15 - 20% in the last year. Recently your capital gain far outstrips any rental consideration. Indeed there is an argument for buying apartments in particular and just locking the door on them to sell them a year later at a profit.

The returns on green field sites are much better. If you buy well then you can indeed sell for double in 2 - 3 months. This is particularly true for sites bought in the slack period of October through to March when we are all up to our necks in snow and all construction is at a standstill. To buy sites (i.e. land), however, you need to establish a company and this brings its own administrative headaches. You must decide if you have the stomach for it. Apartments can be bought by anybody (what are called 'physical' people here as opposed to 'legal' persons i.e. companies).

It must be recognised however that past gains are no indication of future performance and that, as in any property market , there exists the risk of a downturn. Presently it is difficult to see where that downturn will come from. The surge in the property market here is being driven by, primarily, Romanias impending membership of the EU. Were that to be put off by say 2 years (as has been mooted by the European Comission) then I would contend that it would add further fuel to the fire of speculation. Should Romania join the EU on schedule in 2007 then it will quickly become easier for foriegners to buy here and that will also drive the market.

Another poster questioned Romanias demographics as indicating a potentially weak future market. Was this I wonder driven by the emigration rate ? At present it is estimated that there are upward of 1,5 million Romanians working abroad from a population of 22 million or thereabouts. By and large these emigrants are bringing/sending their money home and investing it here. Indeed in the carpark of my own block there are a number of foreign reg'd cars. Two of my neighbours have children in Italy. I'd contend that Romanias foriegn presence is supporting the market and will continue to do so.

At the end of the day every individual must decide for themselves into which market they put their hard-earned cash. I chose to do it here. For me it is relatively easy. I understand the market and speak the language. In June my wonderful Romanian girlfriend will become my wife. I've made a commitment to Romania & in return Romania has been very good to me. It is a fantastic country much maligned.

Therein folks lies my motive for posting here. I'm not interested in being an estate agent. If you want to buy in Romania then find yourselves a good local lawyer and get stuck in. If not then I hope that one day you will at least visit this country and be amazed by its diversity and warmth. I'm tired of going home and having my friends ask why on Gods good earth I choose to live with Gypsies. Are , they ask, my in-laws the same ones who are washing windscreens on Harolds Cross Bridge?? Get real! 99% of Romanians look just like you or me. They are a very well educated and cultured people whose international reputation is very important to them.
If I can do a little to enhance Romanias name abroad and contribute to understanding then my job is done.

This forum exists for people to exchange ideas and information about property and the investment therein. I've told you about Romania. My job is done. Investigate it for yourselves and the very very best of luck to you all!
 
saw translvania tonite during half time it the barca game. looked very like ireland from the train. suspect the Romanians who have come to Ireland over the past 5 years have clouded our view of that country in an unfair way. un pc I know. I see no reason when Romania ( and Bulgaria) join the Eu that their economy, standard of living etc won't improve considerably over time. My concern is if oil etc became scarce or too expensive then it might be hard to let out property and cheap air fares might become less available
 
even train looked better than a lot of the I E ones. Even the ones craig doyle uses.:D
 
Scott, thanks for the effort to change irish people's perception about Romania.

And yes Romania it is a very intersting place both from tourism point of view and as a location for real instate investment provided that you do your research.
 
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