Buy apartment in bucharest via foreign company structure

I'm pretty sure you need to be a Romanian company or have residency here to buy an apartment, but I don't speak with 100% certainty.  Hope this helps.

You might want to refer to this link.
romanianlawoffice.com/purchase-romanian-property.htm

Anyone can buy an apartment (but not the land attached to it), EU citizens can buy land too. I think the OP is Austrian so he could buy an apartment and the land attached to it (most apartments come with a share of the land the block is built on).

I think his question is more to do with whether it's worth putting the buying costs through an existing Estonian company/new Romanian company from a tax point of view (VAT rebates, tax write offs, and so on).

Hi. Thanks for your replies.

I already have a company incorporated in Estonia. Now I want to buy the apartment directly through this Estonian company (without incorporating an additional Romanian company). Is this possible in general?

Reason I want to do this: I have a couple of companies and don't want to incorporate an additional for this purpose. I want to use one single Estonian company to hold property in Romania (and later possibly other EU countries).

Any insight/opinions highly appreciated....

It should be doable. Ask directly a notary, NOT a lawyer.

If it is not permitted specifically by the law now, it will be once Romania is in Schengen.

callincard wrote:

it will be once Romania is in Schengen.

Like that is EVER going to happen

Thanks a lot guys. I will call a notary tomorrow and verify.
BTW do you think it generally is a good time to buy an apartment (in terms of pricing etc.)...

A bit of a dumb questions, but would be interested on your individual views...

A really good time to buy an apartment was about 10 years ago when you could pick up something semi-central for 10K. Shortly after that the prices started rising rapidly until 2008 when they peaked. Now, 5 years later, many apartments are at nearly half their 2008 price (most notably those in blocks from the 60s-80s). Some of the new builds have retained their value, or rather, the vendors are still trying to sell them at their original value, or a little less.

Personally, I don't think prices will drop any more. The price for apartments seems to have levelled out over the last couple of years. The 'prima casa' schemes for first time buyers have helped stabilize the prices as the vendors are keeping the prices within the range of the price limits for the scheme. I expect prices to rise again, but more slowly this time.

So, probably not a bad time to buy. If you're looking for a quick profit, I don't think you'll get it (buying in 2003, selling in 2008 was the period for that) but I think an apartment is a sound investment but you'll only make any money over the mid to long term. However, you probably won't lose money, so it's relatively safe.

If you're looking more short-term return, you'd be better off buying a shitty apartment in a sought-after neighbourhood, renovating it, and flipping it. If you manage the renovations yourself and watch the pennies, you could possible add 10K in value to the right property over a couple of years.

Hi Radolf,

Fro commercial transactions it doesnt matter whether bought by a legal or a private person. You can buy with your Estonian company, but you have to consider that all property taxes have to be paid in Romania. Further you have to consider VAT as this will be applied in Romania as the object is in Romania and I don't know if you will be able to recover the VAT in Estonia.

Is it a good time to buy? All depends on what you expect to gain. Are you looking for a high yearly yield and/or capital gains in the future?

Please be advised that incomes and gains are subject to profit tax in your company. I advise you to contact your tax advisor to have this fully clarified.

If you wish to meet and discuss further please contact me. I am already active in Bucharest real estate since 2006. Just a talk about real estate, free of charge and the coffee is on me! Hopefully you will after this hire me to find you the most suitable property.

Take care!