Destination. A number of sumptuous old buildings have been revamped and turned into attractive casinos and as a result Bucharest is attracting an increasingly affluent class of visitor. These visitors require superior accommodation which Romania currently has in short supply and as a result there are projects currently in the planning stages for the development of new, and improvement of old hotels creating a new opportunity for those interested in commercial property investment diversification in Romania.
Commercial property development is big business in Romania at the moment across the office and retail sectors in particular with rising demand driving development.
Those purely focused on residential Romania property for investment returns might like to consider the upper end of the market where luxury apartments are in short supply but where a growing upper middle class demand is intensifying. According to the Romanian CEO of DTZ, which is a global real estate advisory working with clients to create leading edge property, investment and business solutions worldwide, there’s just not enough property development happening to meet the demand for quality accommodation in Romania which could lead to attractive underlying price inflation for investors or developers with assets held in this sector.
Finally, in terms of the long term prospects for the residential property market in Romania one factor alone could result in an increase in demand for residential property for sale and that factor is the introduction of competitive mortgages in Romania.
According to various reports based on data supplied by the National Bank of Romania for example and assessed by companies such as Domenia Credit, a Romanian based mortgage lending company, up to 90% of property related transactions in Romania are still conducted in cash meaning that the constant improvement in the availability of mortgages for Romanians could lead to a huge surge in those being able to afford property and therefore demanding real estate for sale. Currently the local demand for property in Romania is capped and restricted by the lack of finance available to fund a purchase – however many financial companies are now offering increasingly competitive Romanian mortgages and this could be the key to the rapid expansion of the local market demand. An investor who makes well timed and researched property acquisitions in Romania today could be positioning himself for a significant and sustained property boom in Romania in the future. |
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