Investing in Romania

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Howbout

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I have been looking for a city center type property in either cluj or bucarest as romania appears to be on the up with good employment, rising wages and GDP levels,
Does anyone have any knowledge/advice about buying in romania as this is going to be my first atempt at buying abroad, Advice on Good agents or solicitors for setting up a company for purchasing land...
 
Go for Cluj over Bucharest; the latter is overpriced for any of the good stuff. Also be careful of secondary locations being sold by one or two of the big-name players in Bucharest at prices that more properly reflect the better areas.
 
I'd definitely have to agree with Auto on Bucharest. Avoid like the plague. It's a very difficult place not to get ripped-off in, especially as a non-romanian speaking foriegner.

Cluj, of your two considered options, is definitely the best. Don't, however, discount some other cities which are experiencing strong growth such as Timisoara, Brasov, Sibiu, Oradea, Iasi (the only city in Moldova worth a look in my opinion) etc.

If you're tempted by the ski resorts then for goodness sake buy land, i.e. sites which you'll sell on later to a local who wants to build a chalet. Don't touch any apartment developments. Make sure such sites are as close as possible to the ski lifts, preferably in the heart of the resort. Avoid Poiana Brasov, which is the biggest and most expensive resort, and look for value in the smaller ones such as Baisoara near Cluj or Arieseni north of Alba Julia .

Land is your best bet for rapid capital appreciation provided you buy it right (but remember it doesn't pay any rent), followed by commercial properties on main streets or in business districts followed by new build apartments.

Personally I'd also avoid buying along the Black Sea coast for the same reason that ultimately those who invested in the Bulgarian coast will come a cropper. It's absolutely freezing in the winter and the season is at absolute MAX from the end of May to the beginning of September.

Whatever you do in Romania make sure you engage the services of an expert property lawyer to check title for you. This is ABSOLUTELY essential.

Also be sure to visit at least twice before buying. Get a feel for the area you are thinking of buying in. Hire a translator for a day and then go buy the local equivalent of the 'Buy & Sell'. Have him/her go through the property small ads with you and translate them for you so you can make comparissons.

All cautions on the buying front aside I'd say that you will throughly enjoy any trip to Romania (with the exception of Bucharest) and find that Romanians are some of the warmest and most welcoming folk in Europe. It's most certainly not a land of orphanges and gypsies anymore.

Very best of luck with it!
 
Thanks a lot guys!!, I was thinking cluj myself, A lot of companys and not much hype. but it seems hard to find a lot of deals in cluj, The sites are all focused on bucharest.
In any case I will make the trip to Cluj to talk to some locals (great idea with the translater).
But do know of any good sites selling second hand apartment in Cluj as i keep finding this off plan types and also 1 more question if I may what do you make of IRO investmentinromania.com? seems some good deals there but im not too well up on the areas.
 
If you're going to Cluj then buy yourself a copy of the local 'Buy & Sell' which is called Piata A la Z. It comes out every Tuesday.

You'll find it hard to find secondhand newly built apartments in Cluj as is the case in many large romanian cities. Most of what is being offered down there as new is exactly that, i.e. you'll be buying off plan. That's not a problem really since there is plenty to choose from but select your district carefully.

In Cluj most of the out of town shopping is going up on the western side of the city. Theres a massive shopping centre being built there at the moment by some chappie who owns a football club. Can't remember his name. Cora have already built a hypermartket there. DIY interests catered for by Practiker. There's Metro which incorporates Pizza Hut along with a load of car dealerships etc. The next village out from this on the Oradea side of the city might be a good place to look. There are a number of new apartments going up behind the houses off the main road although having watched them go up over the last few months I wouldn't say that they were the best built. The location is good though.

Most of the new housing is going up on the hill called Feleacu on the southern side of the city. Going up Feleacu on the main road to Turda you'll see a lot of newbuilds in on the left. Also a good spot to look at. Try and buy as low down the hill as possible. I certainly would not buy above the BMW dealership (which you'll find on the right as you leave the town) on the Turda road.

Stay away from the Central Residence development. Looks great. Nice shiny new complex but the prices IMHO are off the wall. Stopped into their sales office with the wife and was quoted something nuts like 2500 Euro/m2!

Expect to pay around 1000 - 1200 Euro per m2. Make ABSOLUTELY sure that the full fit-out is included in the price. It's quite acceptable in Romania, and often done, to sell newbuilds semi-finished i.e no stud walling or need to be plastered on the inside, without sanitaryware or tiling, no kitchen furniture etc. The locals actually like to buy in this way as they feel they are getting a keen deal and it allows them to finish the place the way they want it but it's a headache you won't need so check it all out in detail when talking to the developer.
 
Can't add much to that, except..

Black Sea coast is a good place to buy land, prices still rising, but be sure to buy only intravaillian. Lots of people will tell you that land is due to be made intravillian next year etc, don't believe it.

One of the keys to the future of this area is the move of about 20,000 American military personnel to the new bases, will bring loads of business to the Black Sea areas and will push up demand. Impact is already starting to show, but in my view there is more to come.

Also agree about going up the hill at Feleacu in Cluj, it's where all the big developers are targeting, but beware of UK or other foreign resellers adding big margins to apartment prices there. Regarding 2nd hand apartments in Cluj, forget it, the primary type of older property is communist era rubbish, don't waste time on it.
 
i see, But what do you think of the older city center buildings, Surely there are good for appreciation and rent??Locals prob want to forget the old era and move to new apartments..
Im not sure if i can afford to buy land as you say ´you don´t get rent` But out of curiousity how much would you expect to pay for half acre site with planning already sorted outside Cluj??
 
In the central business district in Cluj I'd say that you would be looking at around 3,500 Euro/mp up for older buildings in prime rental areas. Thats at street level. Upper floors, suitable only for office space, will command half that. I may be abit out on that (if anything on the low side) but I'm basing it on current 'asks' in the city where I live and we'd be typically 25 -30% behind Cluj. It should be easy to buy commercial or office space with a gross yield of 9%, say, but if you hunt around then you can find 12 - 14% handy enough. It's all down to your research and you'll get better at it over time. That's why multiple visits are a must before buying. Stroll around, look at the footfall in a particular area, consider the spending power of the through traffic, look at the types of commercial space available and what goods or services are on offer in that area before commiting yourself. I've been most successful with commercial spaces in food markets and their environs. Relatively low levels of spending power but massive through-put equals steady trade for the tenants and good returns for the owner.

As far as a site in Cluj with planning goes then it's the proverbial length of a piece of string. You are unlikely to find many sites for sale with full planning. 95% of the sites you find will have no planning but be zoned intravilan or arabil intravilan. Usually no problem with planning on either of these two variants but of course restrictions will apply depending on local planning laws. The other 5% of sites you find will probably be for sale with what's called a PUD attached. This is an outline planning permission to you and me.
 
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are there any city centre type plots available ? is there any recommended reputable website?
 
Probably plenty of sites for sale in the city centre but none of them something to jump into feet first. Research, research, research. You need a really good lawyer to check it all out for you.
 
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