Here are 6 facts that show why the Romanian real estate market is perfect for investment:
1. From 2003 to 2007 there has been a constant growth of over 25% per year. Think about this: an apartment in the center of Bucharest in 2003 was worth about 30,000 dollars you will now buy it for over 130,000 dollars.
What caused this massive increase in price? This is when banks started to mortgage loans - people were able to put up as collateral the apartment or house they bought.
This opened up a lot of possibilities, as many buyers are young families with wages above medium but with no other significant possessions.
2. In the first day of 2007 Romania joined the European Union. This is a huge social and economic step for Romania, and will bring much sought after stability.
Although there has been funding from the European Union this will increase as efforts to bring the economy to western standards become more aggressive. This means that wages and general wealth will increase, allowing people to buy more.
3. Wages are increasing more and more: Romania has seen a constant increase in wages and a constant decrease in unemployment. Jobs are being created all the time
People will have more money to spend and like most Romanians they will prefer to actually invest in the comfort of a house rather than renting one or even buying a car.
4. With the integration into the European Union, more and more Romanians will have the opportunity to work abroad. In 2006 there were an estimate 2 million Romanians working abroad bringing 8 billion dollars back in the country.
Families are on a house buying and building trend that will only increase as more money enters the country!
5. In the near future banks are planning to lower the minimum income for a mortgage loan and, better yet, actually remove the need for a down payment which at this moment is between 30 and 40 percent depending on the debt level!
This will of course be a huge spur for buyers with lower income, giving them a fighting chance to buy bigger, better and more expensive houses.
6. There is a very big deficit of houses and apartments: estimates place the need for homes at about 1,600,000 and growing! The government unfortunately can't handle the huge numbers of facilities that must be met, so the people that can afford it actually head towards building houses and villas.
The most luxurious apartments in Bucharest can go up to 500,000 dollars - an amount that will buy a pretty decent lot and actually build a two or even three story house in a residential neighbourhood. The result is almost always better than any apartment can provide.
One normal practice for investors is to buy a few thousand square feet in one of the expanding areas of the main cities, optionally build a house or a villa and resell the property at a later date. A small number of investors that don't want to risk a lowering of prices actually sell right away making a profit of 10, 15 and sometimes even 20 percent.
Believe it or not, Romania's real estate market is ripe for investment opportunities! Act now!
In research carried out by Bradford & Bingley, many people who are beginning to approach the retirement age are wishing that they had gone abroad more often. According to the company, nearly half (48 per cent) of those over the age of 55 claim to have wanted to travel abroad more often. Meanwhile, just under a fifth of consumers surveyed have revealed a desire to either live or work abroad.
However, findings from the company showed that such people are now taking the oppourtunity to go travelling, with the taking out of a cheap loan one possible way in which to fund such plans. According to the firm, the over-50s account for more than a third of all journeys made abroad by Britons, as "there's no stopping globetrotting grandparents or restless retirees".
Paul Whitlock, head of savings for the financial services firm, said: "It appears many over-55s do have something they regret, but in most cases it is not too late to do something about it. Putting money aside and making it work for them means they are one step closer to realising their dreams, whether this be travel to exciting destinations or making a more permanent move abroad."
In addition, the firm pointed to research revealing that the majority (57 per cent) of Britons owning property abroad are over the age of 55. And with Bradford & Bingley suggesting that this proportion could be set to increase even further as more people choose to live overseas every year, taking out a personal loan could well be one advisable way in which to meet the costs of making such a purchase.
The study also uncovered that a significant proportion of the over-55s have regrets about their current monetary standing. More than a third (37 per cent) state that they wish they had started saving earlier on in life - which in doing so could have seen many find themselves in a better position to meet demands for payment on personal loans, utililty bills and other sources of spending. Meanwhile, 27 per cent of those questioned expressed that they would have liked to have begun setting money aside for a pension scheme before they actually did so.
Consequently, 18 per cent of those surveyed reported that if they had the opportunity to go back in time and modify any aspect of their life it would be their finances. This compares to the 17 and nine per cent of respondents who pointed out that if they could change anything then it would be their health and main relationship respectively.
However, consumers of all ages have recently been warned that should they not lend enough time towards thinking about how they are to finance going abroad they could find themselves experiencing monetary difficulties. The news comes as research carried out by Lloyds TSB shows that young people struggle to manage spending while on holiday, as 32 per cent look to borrow cash from their friends and loved ones while a quarter of teenagers claim that they will phone home to get their parents to send them more money.
Philip Robinson, head of debit cards and travel services for Lloyds TSB, suggested: "Parents are understandably nervous about picking up the bill for their children's fortnightly holiday excesses." And with a fifth of teenage tourists taking up to 1,000 pounds away with them in spending money, it is possible that paying off their children's debt may see mums and dads struggle to meet repayments on their own borrowing, for instance personal loans and credit cards.
Both Florin Costache & Tom Dawson are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
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