The success of a real estate transaction

By: Eli Doron, Adv; Yaron Tikotzky, Adv, (C.P.A); Dr.Slomo Nass, Adv, (C.P.A)

1/1/1900

Romania is a country which has vast opportunities in the real estate field. The transactions having as object the sale or the purchase of lands can be seen not only in the real estate domain but also in others. From the development of a residential project to agriculture businesses, everything begins with the acquisition of a real estate (land).

Besides the land transactions, we have to take into account also the building (apartments) transactions which are also part of the real estate field – especially that Romania is a country where the request of dwellings is far bigger than the offer.

In very many real estate projects the ownership right is the one that can generate several problems, if not dealt with properly.

What should be known and taken into consideration by most of the real estate investors is that once the project starts verifications regarding the ownership right over the respective assets should made very carefully. These verifications should deal both with the history of the ownership over the respective asset and with its present status (at the moment of the purchase) and should be performed by a specialist having law knowledge.

Parallel to the ownership right verifications, the investor should use the services of an architect to check if the respective asset is suitable for its project/plan as well as the services of an authorized surveyor (measurements expert) who shall be able to check if the actual size of the asset is the same as the one mentioned in the documents related to the ownership.

There are multiple ways in which a person (investor) can acquire the ownership over a real estate but the most recommended ones, especially for investments, are the following:

a. The sale and purchase agreement – concluded between the investor as buyer and the owner of the asset as seller. IN this case the sale and purchase agreement should be authenticated in front of a notary (according to Romanian law, the ownership transfer of a land is valid only if performed in authentic form).
b. In case the owner of the asset is a company, there is the possibility for the investor to acquire the shares of the respective company.

Another aspect that should be taken into consideration is that foreign citizens cannot hold ownership over lands on the territory of Romania. In this case, the foreign citizen who wishes to acquire ownership over lands has the possibility to incorporate a Romanian limited liability company and to buy the land through the respective company. We have to specify that the interdiction of holding ownership by foreign citizens operates only for the lands and not for the other type of real estate (i.e. apartments) – therefore a foreign citizen can hold in ownership an apartment, but only the building itself.

In case the real estate project involves building apartments or other type of dwellings, after acquiring the ownership over the land, the investor should approach the competent authorities in order to perform all the necessary steps for obtaining the building permit.

S.C. DORON TIKOTZKY CONSULTING S.R.L. is a consultancy company which can assist you, through its specialists, in going through all the above mentioned stages and concluding a successful transaction.
Our office is located in Bucharest, 7 Benjamin Franklin St, app. 4, 1st district;
Phone number: 004-021-233.83.64
Fax no. 004-021-3.15.12.94


Good luck!