Dear Ray, I understand where you are coming from and the advice others have given you is great but the one thing that concerns me is the titles of the property. It is possible to get papers in Romania giving you titles to properties that other people have some rights over. They will tell you it is not possible and it is against the law but I can tell you that there are many communes in Romania where there are more land titles than exists in actual hectares ie if you add up all the property titles for a particular commune you get perhaps 100,000 hectares but only 20,000 hectares in reality exists. This is why so many outstanding claims still exists even though the law in relation to land ownership was changed many years ago.

I think these type of investments in Romania are very risky. In addittion to the valuation and legal issues, the logistics of renovation are going to be hard work.

I agree with you Anna about the renovations and the logistics. Most of the agents here don't offer property management after purchase, therefore buyers are left to deal with things alone. This way they take no irresponsability for what they are selling. They also take money from the buyer and aso from the seller, failing to properly represent either sides. Another issue is the lies they say about how much one can rent or resell a property. One on top of the other, these types make a very bad image to Romania in general.
However, I think, based on experience, although it's hard and time consuming, people can find very good properties in Romania. Tax and legal help is crucial however.

You should ask first for legal advice and only after this you should take a decision because the papers are not clean you cannot be sure that this will be solved so easily. If you could give me more details about it maybe I can help you. Andrei office@tarusiasociatii.ro

Harghita is a poor part of Romania. but beutiful. the mosc common way to get ripeed is to sell you something thats been already sold to somebody else.
before you purchase the land make shure it has CADASTRATION an check at the city hall there.
the land is easy to transform it into intravilan. but not by yourself.
also the land is cheap. don't think u get rich buing that property.
if the land doesn't have all the documents in order don't do it untill u check them. check OVRA, a law firm will be good for that.
i hope i answered some of your questions

Some that I know and have friends facing these problems:

1. What are the most common ways to get ripped off under Romanian system?
- Two or three owners of the same land...
- Bad ownership papers…
- Incorrect evaluation of the value of that land… some banks can help here.
- Very risky… buying a piece of land in a place where real estate mafia have interests to buy for expanding their empire! This happens here, but mostly near by or within big cities of Romania.

2. What checks should I make sure I have covered before I sign a contract?
- Check all the above problems you could face here…
- Also, make sure that the public notary, or the lawyer, is not “team worker” with the seller… Most of them are ok, but as a wise investor you must do your research. A good public notary, attorney or consulting company can help a lot.
- Never deal with people offering any kind of “financial” or etc. services on the streets, and on the net, until you aren't sure who they are.

3. The agent said it would be easy to change land use from agriculture to buildable is this also true?
- Not really, it takes some big amount of paperwork and bureaucracy. And also some extra costs involved. Not easy to build a house on agricultural lands, but easier to build a barn and a temporary housing for the owner. In some areas it is also easy to build a cottage or cabin.

Teodor

Everyone here cannot see the tree because of the forest. This is what overseas agents want. Put the fear factor in, talk about crumbling old blocks and blind you with all sorts of waffle.

First and foremost. Are you getting value? If you are not getting value everything else is incidental and foreigners buying from the new found experts who have rushed here from Bulgaria are not getting value. These so called experrts either do not know their elbow from another part of their anatomy or else do not care how they exploit you.

A perfect example of this is one company who bring Irish & UK investors to Romania. A development they sold at nearly 200,000 euros in 06 was offered to us at 123,000 euros and we turned it down as we could not stand over it for investors. The people who subsequently bought it cannot now even get their purchase price.


Another client who was deceived into buying 3 studios came to us and asked us to sell them. This particular agent has said that the prices have went up 40,000 euros. Of the 3 studios we have been able to sell one at his purchase price in 2006 and the only reason we were able to sell it was that the woman who bought it was not from Bucharest and was not familiar with the area or the poor build quality. Interest in them has been next to nothing locally.


The same figure invested with Investment Romania woud have returned well in excess of 60% and one particular client who came out with one of these companies has just returned over 80% and is testament to this.

There is incredible opportunity to be had in Romania and investors will do very well here. However, if they are not willing to take the time and care pre investment they cannot expect anything other than to get burned in the same way as they would buying a second hand car at auction.

Even this week we see an British/Irish company offering great opportunity in Bucharest, yet not only do they not describe exactly where the property is, but tell people they must set up a company to buy an apartment.

This is either being totally naive or blatantly deceitful and their is no place in any market. And on this topic, this is not a reflection on Romania but the incompetence of UK & Irish legislatures who will not regulate the sale of overseas property to prevent such blatant misrepresentation.


David Howe

Investment Romania - Property Romania, Invest Romania, Investment Romania

I agree with you David, people should look into "am I getting value or not". However there is no lack of naives both abroad and in Romania! My strong feeling is people get what they deserve and if they prefer putting money into something without looking for information re fiscal and legal issues, they should not doubt they get into trouble after.
Others like the flashy display of these developers and are not even cute enough to go see where the developments really are, so again no wonder to me.

Am also growing weary of so many "disaster-lover-analysts" on these websites! Most of them have never set foot in Romania and even have doubts they can correctly point it on a map, yet they venture into appreciations. Nothing that makes me laugh more but to hear words like "rip-off"! Had anyone been born with the sense of business, we'd have no poverty in this world. So of course, people waiting for everything to be done for them without them even opening eyes to look around, rarely do bump into success.

There is great opportunity in this country if you invest wisely and get value. If someone got today an apartment for 105k for example and can resell in 3 months for 150k is a very nice deal! Transylvania Investment not only promises, we actually did and continue to do so.

Unfortunately a lot of pople do not look into investment. Your figure of a return of 150 on 105 in 3 years is not appealing to speculators. Why would they buy of you at this and only return around 40% when they can buy from a certian well known company that says they will get them 40% a year and puts them up in a flash hotel and ferries them around in flash cars.



To a true or semi educated investor this represents a realistic return and one which you state with confidence. In addition and with all due respect you have also failed to mention this person will also get an additional 15% rental return in this period which brings your return up to 55% which in my or any informed persons opinion is very desirable. Put 40% deposit down se rental return to pay mortgage and you have just given people a return of over 30% per year on their money and you did not have to lie or deceive anyone.

Unfortunately many of those you speak of are not as knowledgeable as we are and rely on the information suppied by an agent who even on some occasions actually believe what they are saying as they have been taught this as fact to be more convincing to the speculator.

The reality is people are being deceived and that is sad regardless. What is sader is the people who you mention that are slatting Romania and the opportunity here when this market offers such potential. This makes us all guilty by association and hence the need for people like us to make people more aware, espeially to the fact that this has nothing to do with Romania, but sheer greed by unsrcupulos agents who on so many occasions are not Romanian, but can be found in a cheap suit, fake rolex and flash motor and is imediately the investors new found best friend.

Hopefully at least one person reading this will take stock and look at alternative investments/agents with effect some of these agents will be denied their huge profits that are so often extracted through deceit.

What people need to realise is, when people get something that is to good to be true, it rarely is true! Therefore anyone considering buying an investment property anywhere should take the time to examine it in the same way they would a second hand car. Speak to an independant expert or carry out their own due dilligence, those few extra hours work will reward you well. I currently have 8 people who bought in a development in Bucharest through a company that holds themselves out to be property professionals and what that company did to these people is criminal when there was so much opportunity in the market.

For anyone wishing to buy in Romania I would ask that they be not desuaded from buying due to the negativity that is occuring in this thread. The potential is here the same way as there is in buying a 2nd hand car from a reputable dealer or friend as apposed to buying the luvely motor from the Arthur Daly character.

Thank you David! You are very precise in what you say.
To give the people visiting this website only one example of what Transylvania Investment could achieve so they may form an opinion on the opportunities offered by the Romanian market.
Last summer we got a client who bought with us a flat in the Old Quarter of Brasov for 105k. The place was not in the best of condition so he renovated it, which cost him about 15k (including new furniture and not cheap Ikea standard). In the middle of the renovation he decided to resell since he found a better deal and teamed up with a friend to buy in Cluj. So we resold the flat three months later for 150k to a fellow who will probably resell it in 2 years for minimum 200k and in mean while we rented the flat enabling him to cash a very nice rent that covers the mortgage he got in order to buy it. The man, who bought the apartment for 105k, got a cute commercial in Cluj and now cashes a lovely 10%annual rental return, which is more than okay and keeps both owners and tenants satisfied and in a long term business relation. So our man, not only that he hadn’t lost a penny, but also made a profit of about 4k after paying taxes and notary (giving the fact that he put 15k in the renovation). Had he started a company in order to buy this transaction would have been meaningless as it would have cost him 52,5k.

The morals:
Anybody shouldn't feel or end up in the situation of making a loss if they want to get out of a deal for various reasons, regardless they need to get rid of what they bought the next day or in 3 years time. Anything you buy today you should be able to resell tomorrow and for a higher price than the purchase price.
I also very much doubt there is such thing as 15% rental return on residential properties in Romania, particularly for the newly built, outside town properties, so good luck to all who placed their money into off-plan developments under this illusion.
Anyone imagining money can be done "bang!" in a second, should not cry when loss appears instead of the desired gain. Investment is not the National Lottery!