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The “Metropolitan Bucharest” project, intravillant and extravillant issues
      I can not recall it very clear, if the project was already announced, or if there were just pieces of it known by that time. I think it was public. I refer to the project of “Metropolitan Bucharest”. There was a map released, with several villages (and agricultural lands) around the city, which were supposed to form the “Bucharest of 2050″. Adding 10 - 15 kilometers to each direction, the city was supposed to reach a diameter of 50 km from north to west and about 45 from east to west. I still have this map… it was also marking the population density factor and several factors, like utilities available etc. At that time, the “catch” was the following: “Buy lands around the city, in the next years the Municipality will provide the utilities and you will be able to build. Also, new public roads will be constructed and a new, brighter day will rise for all people”.
      This had come just few months after the new law of July 2005, which gave the right to people to convert their extravillant terrains into intravillant. I had nothing against it, actually i admit  that myself and an endless number of my clients had very big profits out of this. But soon this led to a wrong approach of business: People focused only on the status of the land, not on the utilities. Very few were taking into consideration that a major agricultural area which has become intravillant is still not buildable, unless utilities (worth millions) are constructed until the borders of the property. But… “who cares, Ilia? Sell now and let the next worry, if he doesn’t also sell to the next one too”, as a collaborating agent had proposed to me…

A great idea transformed the market into an aggressive opportunistic one…
      (I can not present myself as “innocent” here, I also invested and proposed investments like these, but I never bought or participated in a transaction with something very far from utilities and not located on a very important location too. For me this was the key issue for the future of an investment.
      So… a great idea and perception for the years to come… appeared in the market. And in the place of “now, not even tomorrow”… people did not take into consideration that it takes decades to really develop a city… they were talking and behaving as if all issues were arranged already…)

This blog it is a collection of truths, myths and realities that shaped the real estate market in Romania only one year ago as seen through the lens of an experienced professional and a passionate promoter of this country’s potential. The blog www.realinromania-blog.com contains stories, experiences and lifetime lessons i learned throughout my five years in Romania.

2008 will be remembered globally as the year of financial crisis and the real estate meltdown. Romania followed the global trend and witnessed the burst of the real estate bubble. But the reasons here were completely different than abroad, and that is why the results will not be the same either.

Rewind to only one year ago, the media was flooded with reports of new and ambitious projects, transactions, speculations, artificially-driven prices, millions and billions invested in real estate. The number of transactions was already decreasing, but no one was paying attention. Prices were at “sky high” levels, same with the arrogance of those whom we call “major market players”. It was very difficult to focus on real business, following principles and rules. Difficult, but not impossible… Fast forward to today, the picture stands in stark contrast to what we have witnessed in the recent past. The boom phenomenon has halted and even reversed, leaving many lessons learned for Romania.