Where is Romania?
Romania lies between the Ukraine and the Balkans in Eastern Europe. Hungary is to the west, Serbia and Bulgaria to the south & Ukraine to the north. The capital, Bucharest is located in the south east 60 km, north of Bulgaria and 180 km from Black Sea coast.
How do I fly to Romania?
From the UK, numerous airlines including BA & KLM offer direct flights to Bucharest. Prices start at £175 and flights times are 3 hrs.
Why consider a property investment in Romania?
- Property prices are below other European levels (circa 50% of property prices in Bulgaria)
- Growth in Tourism - the World Travel and Tourism Council (WTTC) predicts Romania to be the 4th fastest growing tourism sector in the world with a growth projection of 7.9% per year from 2007-2016
- Romania is a beautiful country of dramatic mountains and rolling hills, fertile plains, rivers and lakes Romania’s Black Sea coast, stretching over 200 km provides clean sandy beaches with minimal tides – ideal for young children
- The climate is temperate with four distinct seasons. Temperatures in the summer average over 70°F with July & August peaking at 79 °F
Where should I invest?
The main areas experiencing investor demand are the capital, Bucharest, the resorts along the Black Sea Coast and the mountains regions of Banat and Transylvania.
What do the analysts say?
- ‘Romania is set to be the rising star. Its fledgling property market is well worth investigating, before it really takes off.’ - A Place in the Sun, Channel 4
- ‘As residential prices are still low compared to the region, this sector has probably the biggest opportunity in terms of future growth and development.’ - Colliers
What restictions exist on Foreign Ownership?
Currently, foreigners may directly own buildings but they may not directly own land. However, it is an accepted and common practice on the Romanian real estate market for foreigners to own land indirectly through legal entities incorporated in Romania, even if such entities are wholly owned by a foreign entity or individual.
All acquisitions of real property must be registered in the real estate registry (Land Registry) Registration of a change in ownership normally takes at least one week.
What costs do I incur during the property purchase?
A stamp duty, including a fixed amount and percentage calculated on the value of the real property ranging from 0.5% to 3% (subject to 50% discount for transfers of undeveloped land), must be paid for notarisation of sale-purchase contracts involving real estate.
Mortgages and transfers of real property must be certified by a notary. The fee is negotiable but normally ranges from 0.5% to 1.5%.
Payments of commissions and fees for services performed in Romania (e.g. consultancy and management services) are subject to a withholding tax of 15% irrespective of the location where they are performed.