Romania Property Investment News

Romanian government confident of further economic growth

Romania’s minister of economy and finance anticipates 2008 will be a positive year for the country’s economy, with no sign of slowdown in any sector. The ministry also forecasts significant growth in the number of real estate transactions and construction of properties, all of which augurs well for potential investors in Romanian property.

According to Varujan Vosganian, Romania’s minister of economy and finance, the country’s GDP per capita is expected to reach €6,200 in 2008, up from €5,600 in 2007. Furthermore, the value of real estate transactions could reach approximately €23 billion in 2008, according to January’s Monthly Economic Review on Romania, released by Ernst & Young. Revenue taxes collected on real estate transactions last year reached 1.2 billion RON, which was more than four times as much as the previous year.

The spending power of the Romanian people is likely to continue growing as unemployment in the country falls (from 5.2% in December 2006 to 4.1% in December 2007 – a level considerably lower than other medium or large economies such as France, Germany, Spain and Poland). This in turn will drive up domestic demand for accommodation in Romania, both to buy and to rent.

It is Romania’s emerging middle class that is seen as providing many of the major opportunities for real estate investment. Bucharest receives a large proportion of the country’s inward investment, and the city has received a considerable level of corporate foreign investment as large multinational companies have moved in. As well as giving the city a more cosmopolitan and modern feel, this has created a growing professional workforce whose rising affluence is in turn generating demand for quality housing to rent or purchase.