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 How to buy an apartment in Romania?

A lot of people are asking if making areal estate investment in Romania is easy. The answer is that it can be very easy if some steps are followed.
If you want to buy a real estate (may it be an apartment or a land) it means that you are also prepared to pay some money for that investment, which is not bery little. This is why you need  to know how to protect your money.
First you need to valuate the price of the asset and see if the one listed is fair or not by taking a closer look at its surface (useful area vs. built area), location, year of construction or finishes.
Secondly you need to check what taxes such a transaction presupposes ( VAT issues, taxes for signing the sale and purchase agreement, ownership or rent taxation),  what is more convenient – to buy as an individual or to buy through a company – and, last but not least, the capitalization (yield) that the asset gives in time.
 

 

 
Thirdly, a very important step that you would want to take is to check the legal situation of the land. If taxation, price and location can be checked very fast, when it comes to legality things are not always the easiest and in most of the cases there is a need to use the help of a law specialist. And this because, in Romanian law, the ownership right is one of the most complex law institutions. Technically, the buyer buys from the seller via a sale and purchase agreement which is the instrument which transfers the ownership right, with one condition: that seller is the rightful owner of the asset. According to the law the ownership (which gives someone the quality of owner) is proven with the history of the ownership – meaning all contracts attesting transfers of ownership from owner to owner for as much as one can go back in time. This means that the buyer must check all ownership titles of the seller and before hi. In such conditions, the re are cases in which you have to check even 100 years of history of ownership.
Performing such a legal analysis – most often as a legal due diligence – is of extreme importance because if one ownership transfer was not done according to the law, then all subsequent ownership transfers are null and void and the buyer can fall in the trap of paying the price of the sale to a non-owner..
This is why the technical verification of the legal status is mandatory to be done by a law specialist, in order to avoid present or future problems.
Nevertheless Romanian Real estate market offers presently a lot of options for all pockets, which can be turned into successful investments if verifications are done properly.

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