Decline in Communist flat prices set to be gradual

Discussion in 'Romania property' started by David howe, Jul 8, 2008.

  1. David howe

    David howe New Member

    The Below statement is courtest of the Diplomat magazine and why I think so many people make mistakes when buying property.



    Between April and May this year, Bucharest’s new apartment prices remained at 1,909 Euro per sqm, while older apartments droped by five per cent to 1,808 Euro per sqm, according to Colliers.
    Communist-era apartments in attractive central locations ensure the prices for old apartments are not seeing a rapid fall, while new flat developments in the less accessible outskirts are keeping their average price flat.


    The price quoted here of 1909 fails to mention that it is exclusive of Vat, it also incorporates the common area that is not taken into consideration on a resale with effect that when you add 15% on to cover the common area we get a price of near 2500 per meter, mean while when existing is sold at 1808 per meter inclusive of Vat. This is in my opinion a clear example of where like is not treated as like with unfair comparators being used with the detriment that people rightly assume without all the relevant information necessatated to make an informed decision.

    Furthermore, and most importanatly people must realise that the asking price of a property is not always the value and when people realise this they will no longer be like a drunken man who uses a lamp post for support rather than illumination.

    The Comunist stigmata attached to older buildings is something that all agents selling new off plan like to use to demean older buildings and glamorises new. How many people do you know in the UK and Ireland who are not rich enough to live in something built after 1989, I know quite a few and I even know others who actually live in houses that are up to and over 100 years old and hide behind the 'Period dwelling banner of Victorian or Georgian.


    Can you imagine anything more embarrassing than not being able to live in something built after 1989?

    there is much more investment opportunity in existing apartments in Romania than the New off plan and if you have any doubts, go do your due dilligence, then make an informed decision as all that glistens is not gold.

    David Howe LLB. LLM.

    INVESTMENT ROMANIA - Investment in Romanaia, Property management, Due diligence, Renting in Romania
     
  2. Very accurate, David. I wonder how much they paid to get this article published. It is quite funny.
    I am in Slovakia now and what I suggest to people willing to criticize the communist buildings in Romania, is to take a trip to Povanska Bystrica for example. Anyone curious to understand more about what I write here, should have at least the curtousy to google it up.
    Yet another thing fellows, there are buildings in Romania built before the communists. Should we blow them up and build some disgusting glass and concrete crap new developments in their place? Just wondering, since they are also old. Had the developers of these new brutal architecture buildings - google this up also - any imagination or feeling for beauty and not simply a strong desire to fatten their wallets building on every square inch available, without assuming people need parking, green space, children playgrounds and other similar things that make a space worth living in, I would support the new developments. But since the nice new buildings are very rare and what David said happens once too often, let me doubt this article.

    Diana Marinescu
    Transylvania Investment Managing Partner

     
  3. David howe

    David howe New Member


    Actually in my frustration of the New generation builders slagging off everything pre 89 I forgot actually to address just how bad some modern design buildings are and I appreciate you bringing this up.

    Be it UK, Ireland or Romania, over the past 10 years developers have been bringing stuff to the market which people in the future will no doubt scorn in the same way as we did the Orlitts type builds in the uk of the late 40s-50s.

    As so correctly stated, archiectural design on new builds globally is in some cases dreadful and in all fairness to Ceascu and the comunist era, they maximised space with a per meter quota, (which you can remind me on per person as is so long since I read it) which made them practical and functional.

    Today buildings are also designed in a practical and functional method ony the practicality and function is to makimise profit for the developer with effect the end user gets a less practible and functional property. People look at the externl picture and think wow? They do not study the design to see how space is utilised and more importantly light Before we did the Pallady build I studied a lot of UK & Irish designs and was totally horrified how bad some of them were, on examination of the builds I was disgusted to see how workmanship inn Ireland had deteriorated.

    We have had several look at the work Tripa did for us and everyone has complimented his standard of work and finish.

    I will try to attach a picture to this thread of an off plan I was recently asked to do due dilligence on that was sold to a foreigner by agents operation on the UK market for a Uk developer. Some agents are heralding it as one of the best developments currently on the market in Romania. the 2 Romanians who came with me were in convultions laughing at it and asking 'do foreigners really think we will buy this crap.'


    Romania like every good property investment location has great potential, but only for the informed investor. Slick guys with cheap Rolexes who know everything there is to know about property investment in Romania are sales men not advisors, I have 7 years experience here and I am still learning something new everyday.

    David Howe LLB. LLM

    INVESTMENT ROMANIA - Investment in Romanaia, Property management, Due diligence, Renting in Romania
     
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