Romania Property Market: Local Buyers Profile
August 9th, 2007
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Medium buyer living in big city
• age: 25-50 years
• income: €500-2000
• owns a property or has €20,000-40,000 from savings and family
• active life
Property they look for:
• Old apartment (communist apartment) in good position.
• New built apartment in modern complex. There is a limitate number of new apartments on the markets. Only off plan apartments are available for purchas at the moment, with some of them to be delivered by the end of 2007.
Price:
This type of buyer will be able take €60,000-120,000 mortgage, with an additional €20,000-60,000 from savings and their spending limit is €160,000.
Is common for banks to cumulate family income (wife, parents) when appling for mortgage.
Income grow and more flexible price conditions will alow this buyer to take a €130,000-170,000 mortgage within 2-3 years. This will increase the maximum spending limit to €230,000 in 2010.
IMPORTANT: Because this buyer is looking for a house to live in he will be tempted to buy a new project apartment in a final stage of execution, rather than in an earlier one.
In medium cities property prices are 30-40% lower and is usual to build your own house.
Medium-high income buyer
• 28-50 years old
• €2000-8000 monthly income
• works in an international company on a middle management position or is a lawyer, doctor, or medium size business owner.
• Active life
• Lives in major cities
• Owns at least one property, probably an old apartment in medium-god location.
This type of buyer is looking for a house to speak his social position. He will prefer a suburb villa in a new residential development or a new top location apartment.
This property will cost from €180,000 to €350,000. Recent low changes allow to people with over €2000 monthly income to take credit in less restricted conditions. This will increase pressure on top level properties.
Is common for high income buyers to invest in a second property, usually a holiday house or a buy to let property.
Economical boom in recent years resulted in a consistent number of highly paid people especially in Bucharest and major cities. This is the reason for the very big demand in upper real estate segment with many investors ready to cater this very profitable segment.
Rich Buyer
• Local and international businessman
• top politician
• top management in multinational company
They are forming a very particular class of investors. Owning big land properties they profit from price grow in this sector. They are also the buyers of old representative villas in top location. Is normal for them to spend €1-4 mill for a property.
Investors are targeting this type of buyers, with luxurious developments in best location. In Bucharest the upper segment is concentrated in north area, with places like Primaverii on top of the property market.
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