Simon

This is an interesting article and I agree with much of the points you make. I have visited Bucharest twice recently and it certainly ticks many of the right boxes as a property investment location. However, my main problem with Bucharest is that it's a potential earthquake risk. There were many buildings damaged in the March 1977 earthquake and there have been some smaller earthquakes since. I appreciate that one could counter-argue about insurance and newer buildings being "earthquake resistant" but nevertheless the risk is there. What are your comments?

Pat Murphy

Hi Pat

I think insurance is indeed the answer.
I can't see this as a key factor when it comes to price growth.
Much of Italy is in an earthquake zone - and much of its properties are ancient. But this doesn't seem to bring down the prices of real estate in Siena, Florence, central Rome, Portovenere and so on. Not in downtown San Franciso either!


cheers

I was in Romania (Pitesti) about 2 years ago, on the 8th floor of a hotel and talking to my wife on the phone, when there was a quake which measured 5.4.

A few car alarms fired up and the building seemed to rock about a bit but most people didn't seem to take much notice....apart from me dashing about wondering whether I was delusional.

When I spoke to a few people the next day, there was no damage and everyone was confident in the structure and nature of modern buildings to cope with such episodes. I understand that regulations are such that all new builds have a certain amount of protection which seems to work.

Hello Pat,

The 1977 earthquake which hit Romania happened in Vrancea area (in the Eastern Carpathians) and did effect Bucharest. Effectively Vrancea is the region which is affected most by earthquakes.

In case of buying property in Bucharest you might want to check if a certain building is on the city hall "earthquake list" (or "lista cutremuri" in Romanian) , in case it is built BEFORE 1977

There are 4 classifications

1) Class I PLUS (public danger)

http: / /www .cutremur .net /cutremur /data /Risc _seismic _gradul _1 _plus .pdf

2) Class I

http: / /www .cutremur .net /cutremur /data /Risc _seismic _gradul _1 .pdf

3) Class II

http: / /www .cutremur .net /cutremur /data /Risc _seismic _gradul _2 .pdf

4) Class III

http: / /www .cutremur .net /cutremur /data /Risc _seismic _gradul _3 .pdf

Not all lists are updated, so you might want to call City Hall to verify the property you might want to purchase. City Hall : +40 21 305.55.55 interior 2601

In case of buying a property with mortgage, no bank in Romania will be able to effectuate a mortgage, in case you choose to finance, since no insurance company will be able to insure the property (as full property insurance is an obligation when taking out a mortgage!)

But many buildings who do not appear on the City Hall earthquake risk-list, can appear on seperate blacklists held by insurance companies (this is not publicly known)

Therefore, and advice would be always to call 2 or 3 insurance companies and verify if the actual building or property is not on their internal list as well. This gives you more certainty in case of buying property built before 1977

But to keep things in perspective , ONLY 386 buildings in the whole of Bucharest are considered an increased earthquake risk ... and many other properties anyway have been built after 1977 in Bucharest and are considered 100% save.

Hello and thanks

This is useful information. It reduces concern in relation to earthquake risk!

Pat