Author Leaonne Hall is an expert on the overseas property market and has written extensively for a number of newsstand titles. She previously produced three editions of the Red Guide to Buying Property in Eastern Europe, and has been writing in detail on the individual markets since 2003.
A country of outstanding natural beauty and home to one of the world’s most enduring myths – that of Dracula, based on the historical figure of Vlad the Impaler – Romania has reinvented itself as Europe’s biggest investment opportunity.
Why buy in Romania?
With a lack of available property, cheap prices and rising numbers of affluent Romanians, demand is growing for good-quality homes. Couple this with Romania’s burgeoning economy and a rapidly-growing property market and you have a superb environment for investment.
The Romanian economy is growing fast, with GDP currently sitting at a massive 7.8%. Jobs are on the increase, wages are rising and thanks to the skilled labour force, foreign direct investment into the country is rising too – by the end of 2005, $13.6 billion had been invested here, with multinationals such as Avon, Wrigleys and Renault settling in the country.
Romania formally assumed EU membership as of 1st January 2007 and this has had, and will continue to have, a positive impact on the country’s growth, with EU funding helping to reform the infrastructure and economy.
In terms of tourism, Romania is the fourth largest-growing economy, and between 2007 – 2016, it is believed the annual average rate of tourist growth will be 7.9%. As the tourist industry becomes better established, then this is destined to further fuel the property market.
Outside of the macroeconomic factors, Romania is an extremely beautiful and welcoming country. The scenery is stunning and unspoilt, the coastline is superb, stretching for 244 kilometres, and the summer climate is characteristic of Central Europe. There are a number of spas in the country, which provide various treatments, while there are also good, cheap skiing facilities. Other outdoor activities include bear and wolf tracking, trekking the Carpathians and bird watching on the Danube Delta.
Culturally, the country is extremely well developed, with numerous UNESCO World Heritage sites and some fabulous towns and cities – including Braşov, Timişoara, Sighişoara and Bucharest, to name but a few.
Politics and economy
Another of Eastern Europe’s post communist countries, today Romania is a stable parliamentary democracy where executive functions are shared between the President and the Prime Minister. The current President is Traian Băsescu and the Prime Minister Călin PopescuTăriceanu. Currently, Romania is enjoying an atmosphere of stability and cohesion, and while economic recession and financial scandal have been rife since the fall of communism, the country is making great leaps towards becoming a free market economy. However, a certain amount of realism should be kept in mind. Romania is still one of Europe’s poorest countries, even though it is hoped that EU accession and the consequent funds will help revitalise an economy left bankrupt from many years under the rule of the dictator Ceauşescu. Emerging from three years of recession in 2000, since then the government has been working on reinvigorating industry and has privatised a number of previously state-owned enterprises. With growing demand for Romanian exports and low unemployment, the future looks promising, with the property market and the level of foreign direct investment set to expand.
Geography and climate
Southeastern Europe’s largest country, covering 238,391 square kilometres, Romania borders the Ukraine, Moldova, Hungary, Bulgaria, Serbia and Montenegro, with a coastline to the southeast which borders the Black Sea. The Danube flows along the southern border and its delta leads into the Black Sea to the north of the resort of ConstanŢa. The country is clearly split in two by the Transylvanian Alps and the Carpathian Mountains which sweep from the north to western Romania, clearly dividing the regions of Transylvania to the north and Wallachia in the south. Thanks to the varied topography, Romania’s wild, mountainous landscape is tempered by the Black Sea beaches and Europe’s largest delta, that of the Danube – also a biosphere reserve and World Heritage site – to the Parisian boulevards of Bucharest.
The Romanian climate can be very changeable and also severe, especially in the winter months when the landscape remains snow-clad for many weeks, with plummeting temperatures of between – 15 and – 20°C and icy winds from Russia. Spring is wet but pleasant, heralding a season of blue skies, but it isn’t until May that the weather really warms up. The summer months are hot, with nine to ten hours of sunshine a day, particularly along the coast. The autumn months are cool, marking the start of the migration of the millions of birds on the delta.
History and culture
There is evidence that Romania has been inhabited since prehistoric times. In recent years, the country has experienced long periods of occupation at the hands of the Hapsburgs, Ottomans, Austro-Hungarians and Russians. It wasn’t until 1859 that the modern state of Romania took form, with the merging of the principalities of Moldavia and Wallachia. On the side of the allies in WWI, Romania was conquered and occupied by the Austro-Hungarians and Russians, and at the war’s end, Transylvania was returned to Romania by Hungary. However, on the side of Nazi Germany during WWII, Romania was taken by Russian forces during the Axis powers’ defeat, and a communist regime was soon implemented, with the Russian forces maintaining de facto control until the 50s, forcing the abdication of the Romanian king. Following the retreat of communist troops in 1958, Romania became an independent state, and while maintaining a Stalinist policy throughout the 60s and early 70s, the country had a very open relationship with the world, cultivating close ties with Germany. Economic growth continued throughout this period, based on foreign loans and the increasing influence of international financial bodies such as the IMF – a policy which flew in the face of communist leader Nicolae Ceauşescu’s policies and eventually resulted in a reimbursement of foreign loans which crippled and impoverished Romania’s people and economy. In 1989 Romania revolted, overthrowing Ceauşescu which eventually resulted in the creation of a democratic republic.
A cultural hotbed, Romania’s chequered past has developed a varied identity in the country. The Romans left a massive influence in the form of the Latin-based Romanian language and the architecture, with historic castles, traditional villages and colourful wood-built churches, while Romania is also home to the infamous Count Dracula. There are a number of UNESCO World Heritage sites, including the wooden churches of Maramureş, the citadel of Sighişoara, the painted churches of northern Moldavia, the Saxon fortified churches of Transylvania and the Dacian fortresses of the Orăştie Mountains. Bucharest is known as the ‘Paris of the East’ and offers elegant architecture and wide, leafy boulevards, while the region of Wallachia is home to a strong gypsy culture.
Christian Orthodoxy is Romania’s leading religion, practised by 90% of the population, despite the fact that Romania is a secular state with no national religion. The remaining 10% consists of Roman Catholics (5%) and Protestants and Jews (5%).
Tourism and getting there
The tourist situation is comparable with that of the Czech Republic ten years ago. The fourth fastest-growing tourist economy in the world, while only six million people visit every year, the industry is predicted to grow by 7.9% per annum between 2007 and 2016. Tourism has a hugely important role to play in Romania’s future economic and social development, with the 2006 tourism economy contributing 4.8% to Romania’s GDP and accounting for 485,000 jobs, representing 5.8% of total employment. Over the next ten years, travel and tourism in the country is forecast to achieve annual growth of 6.7% in terms of GDP and 1.6% in terms of employment. This would take the share of GDP and employment to 5.8 and 6.9% respectively by 2016. While there is an increase in tourists from Western Europe, most come from neighbouring countries which are equally poor. If Romania is to develop economically, it is essential that the tourist economy is well marketed and developed in the west and also that budget flights are introduced into Bucharest.
There are currently four international airports in Romania, with the majority of international flights using Henry Coanda Bucharest airport. Considerable investment is needed to ensure that these airports are able to cope with more visitors and upgrading of Sibiu Airport is already under way, which will provide an important access point to Transylvania. Currently, Wizz Air (http://wizzair.com) offer flights from London Luton to Bucharest and British Airways (www.ba.com) fly to Bucharest, Timişoara and Targu Mures from Heathrow.
The cost of living
The cost of living in Romania is among the lowest in Europe, with services and products almost 50% cheaper than those of their Western European counterparts. In Bucharest, a loaf of bread costs as little as 9p, half a litre of beer from 10p to 40p, and a litre of milk 8p – and this is the most expensive city in the country! However, the cheap cost of living does reflect the living standards, with Romania not offering the quality of living of many of its other, more developed Eastern European counterparts.
Food and drink
Romanian fare is not designed to be à la carte but instead to be warm, filling and nutritious to help you cope with the cold, harsh climes. Pork dominates the menu, along with cabbage and potatoes. More traditional dishes include sarmale (cabbage leaves stuffed with rice, meat and herbs) and mušchi poiana (beef stuffed with mushrooms, bacon, pepper and paprika), with many Hungarian and Turkish influences evident in dishes such as moussaka and hotpots.
Romania offers some good wines, although beers tend to be imported. The national beverage is a plum brandy known as Ţuică and there are numerous coffee shops in which you can stop off and enjoy a pastry and a hot beverage – Romanians take their coffee black and sweet.