Capital of the country, Bucharest has over 2 million people population and a fantastic appeal for investments.
Recent history of the city was quite confusing, communist regime changed major part of the old, historical Bucharest. In mid ‘80s a lot of old buildings were demolished and replaced with concrete blocks. There are a few charming places with very interesting houses from ‘20-‘40s but most part of the population is living in communist build apartments.
Road infrastructure is in poor condition at the moment, but over 2000 roads are in course of modernization or there will be soon. The most part of the infrastructure work is set to be done by 2008, with other big projects to be ready in 2012-2015. Today Bucharest is looking more like a construction yard and less like a European capital, but this is good news for investors.
Public transport is served by busses, electric busses, tram and metro. Important investments were made. Old busses were replaced in recent years by modern comfortable ones. A vast program of tram lines modernization started in 2007 and the metro is expanding its infrastructure. New lines and stations are being build to serve the Colentina and Marasesti Hospital, a new line is being build to serve the Drumul Taberei road and another one is planed to serve both Baneasa and Otopeni Airports.
Bucharest historic center, Lipscani Area, is undergoing significant restoration.
Big commercial centers have been built in different city districts and supermarkets can be found in every part of the capital. Since 2000 the city has seen a fantastic urban renewal, commercial and residential developments are on the way almost everywhere in the city.
Locations:
NORTH AREA (BĂNEASA, DOMENII, AVIATORILOR, HERĂSTRĂU, PRIMĂVERII, DOROBANŢI AND FLOREASCA.)
This is where the upper level market can be found, with both new and old
luxurious properties. Streets like Primaverii are targeted by the economic and political elite. On Primarii you can even find Ceausescu’s former residence, in a restrictive area until ‘89 revolution.
Prices in the area are starting from €3,000 per sqm for houses and €2,000-5,000 per sqm for land.
High prices in upper market have convinced investors and buyers to look for upcoming areas to invest. Middle income buyers and tenants are attracted by lower prices areas such as Vitan, Drumul Taberei, Militari, Colentina and Titan (in west, east and south of the city)
SUBURB:
Before 90’s the regions close to city were used exclusively for agriculture. Until recently there were no suburb houses. Reality is totally different now, many suburbs are build in the regions close to Bucharest (Ilfov). The process was first started in the north part of the city, Pipera County being transform from an uninteresting small village into a booming residential area.
Another north development is placed in Corbeanca, 16 Km from Bucharest, known as Green Paradise.
30 Km north there is the Snagov Lake, a recreational and holiday area that is changing into a permanent residential area.
The trend being set in north was not long until investors have started to invest in other areas surrounding the city, taking advantage of their lower cost.
Properties to look for
Is no secret that a good investment property will have to both rent and sell well. It although should be easy to maintain, secure and trouble free.
OLD OR NEW?
Most part of the current properties in Bucharest were built under the communist regime, offering poor living conditions and lack of privacy.
In terms of investment you should look for new apartments. Buyers and tenants are more attracted by new developments.
It’s worth to mention that old communist era properties in prime location are highly targeted by buyers and tenants especially because of the extremely low offer of new buildings. Some of these communist built properties have been refurbished to modern standards and are highly priced on the market. This is the case of blocks across Unirea Boulevard, built by Ceausescu to be the main boulevard in the capital. Prices start here from €150,000 for one bedroom apartment and go up to €500,000 for a penthouse.
Old apartments close to new malls and parks tend to cost more and rent better.
So if you want to invest buy new, it will go better both on short and medium term and is definitely the best solution on long term.
It won’t be difficult to find new properties since many residential projects are currently underway with an important number in the city center or close by.
Outside the city an increasing number of modern style residential communities of both low-rise apartments and villas are under construction. This is the case mainly in northern suburbs of the city.
The buyers and tenant driving the market are moving from older buildings to new, comfortable apartments and villas. Features such as individual heating, thermal insulation glasses, parking and security are affecting the desirability of a new property.
BEST PROPERTY:
New built one bedroom apartment, 50 sqm, 1st floor or higher, close to city center, near by public transport, walking distance from metro station.
TIPS:
Look around to know the area.
Try to find properties close to city center or nearby public transport.
Close to park properties are more desirable
Is it west facing for evening sun and west or east for morning sun?
Is it close to busy roads? Very important for the property to be easily accessible
Is there a view? Hard to find in the city, thereby very profitable to invest
Is there an opposite building? Will they build one?
For short term profit you should look for properties in already built areas. It will be hard to sell or rent properties inside or close to big work yards.
SIZE MATER. DON’T BUY OVERSIZED
Ideal size for one bedroom apartment is 50-60 sqm. Above this size the property price will have to be higher then the going-rate for an apartment in the market. Tenants will be hard to get cause the maintenance is more expensive.
Ideal size:
One bedroom: 50-60 sqm
Two bedroom: 60-100 sqm
Three bedroom: 90-150 sqm
OLD VILLAS: BIG IS BETTER.
If you invest in old representative houses in top level area you should look for bigger properties. Companies seek this type of houses to set up offices or as luxurious residence.
MARKET SUPPLY
Some 3,000 apartments will be delivered on the market until end-2008 in 22 residential projects, according to Colliers International realtor. This compares to the nearly 800,000 old housing units in Bucharest and means a marginal increase on the supply side. Out of these, only 10% are luxury apartments. However, the projects in the low-end segment are in their early stages and the growing prices may force developer rise prices eventually.