Introduction
Demand for new property in Romania is at an all-time high and stock is very lmiited. In fact, it has been estimated that there is a shortage of around 965,000 homes across the whole country, with the highest deficit being in Bucharest. These conditions alone would send a market spiraling up.
But in addition, Romania joined the EU at the beginning of the year. In doing so, it had to meet very strict economic, political and financial criteria that now pave the way for foreign investment and increasing demand for property.
So the Bucharest market is set to be one of the hottest property markets of 2007 – a fact supported in recent reports by Jones Lang Lasalle and Ernst&Young that listed the city as the top place to invest during the next 5 years. This view is also shared by many companies who have recently relocated to the city - Deutsche Bank, Orange, Vodafone, Toyota and Goldman Sachs to name but a few.
Such companies are improving salaries and employment opportunities and are attracting more inhabitants to the city in search of jobs. With a maturing mortgage market and with interest rates increasingly under control, there is a new emerging middle class who are eager to move out of crumbling, communist-era blocks and into newly affordable, high-quality family accommodation.
Located in a secure and gated community, our villas at Forest View are a perfect mix of price, style and location to attract this growing sector. In fact, a recent survey done by a local university found that 43% of Bucharesti want to move to individual houses.
With an average discount of 34%, under £17,000 deposits and non-status mortgages available straight from the developer, these villas offer an enticing investment opportunity in a fast growing market.
Read on to find out more and as ever, give us a call on 01273 627 900 to speak to one of our property consultants.
Warm regards,
Alise and Jonty Crossick
Buying at a discount gives you security on your investment and also some instant equity. But how can you be sure that your investment is truly priced under market value?
By carefully researching the local property market, you can find other developments that are in a similar stage of build, of similar quality and size and in the nearby area. Stripping the deals down to their bare bones, the price per m2, will help you compare apples with apples and help you understand what is a good price – or a great price in the case of Forest View!
Price Comparables
Our comparables indicate that the average market value of southern Bucharest is €1,m2. Our prices are excellent value in an emerging market – in fact our cheapest price is 35% below the average market value of southern Bucharest. This means that you can buy a villa for the price of an apartment!
Buy a villa for the price of an apartment
The research carried out by leading real estate professionals Colliers International and REAG (the Real Estate Advisory Group) support our comparables. They have found that the average market value for property in Bucharest is in the region of €1,000 and €1,500 per m2. Next to these figures, €714 per m2 truly provides great value in an emerging, but rapidly growing, market.
The advantages of buying at under market value
1. By securing properties at a discounted price to market value, you get instant equity – i.e. the amount of your discount. You lock in profit when you buy and capital growth becomes a bonus.
2. It also gives you added insurance against market movements – the market would have to drop by the full amount of your discount before you would begin to lose money.
3. Buying at discount also acts as a leveraging tool. Capital growth is enjoyed on the actual market value of your property, not on the discounted purchase price.