CHAPTER TWENTY-FIVE: Property Investing in Romania

With a stabilising economy and foreign investment from multinational companies like Renault, Wrigleys, Delloite & Touche and Avon flooding in faster than in almost any other country in Europe, Romania has the potential to be the next economic miracle. As a result of this increasing interest, the entire real estate market has already altered beyond recognition – turnover is rapid and prices have risen significantly over recent years. This is likely to continue – interest rates in the country are dropping, which will open up the domestic market to hundreds of thousands of new borrowers (who were not permitted housing loans until 2002) and push prices up further. Demand is therefore currently strongly exceeding supply. Huge infrastructure spending is in the pipeline (on telecoms especially – and a number of new highways are also being planned across both Romania and Europe), and the country has a motivated and educated labour pool that is still incredibly cheap. The economic indicators therefore show that Romania is a country ripe for investment.

Due to the recent nature of these developments, prices are still surprisingly low, with some apartments selling for £15,000 ($25,000) and amazingly modern holiday homes at a mere £45,000 ($75,000). House prices are expected to rise four-fold over the next ten years, however, as Romania benefits from its entry into the EU in 2007. For this reason, and in terms of its status and potential as a tourist destination, Romania is currently one of the best countries in Europe to invest in.

Price History…