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The Benefits of Investing in Real Estate Located in Chisinau, Moldova

Written By: Jacquelyn Annete García Vadnais

In recent years, there has been a trend for investors to build extensive real estate portfolios around the globe. As more popular markets became oversaturated and too expensive for extensive real estate investment, real estate investors have targeted emerging markets as a viable real estate investment that has significant short-term benefits and long-term investment gains. In terms of investment prospects, it is wise to look at the entire picture when considering whether a respective property and/or market are the ideal fit for your real estate investment portfolio. One global market that has been experiencing a great deal of interest is Moldova. Particularly, Chisinau, Moldova is becoming a hot spot for real estate investors looking for significant returns. To learn more about why Chisinau, Moldova may potentially be the ideal fit for your next real estate investment, consider the information below. 

Background of Chisinau, Moldova 
Chisinau is the capital of Moldova. Many investors are unaware of Moldova due to the unique history that the country has had. Moldova has had a varied involvement between Russia and the Ottoman Empire throughout history. Even though Moldova was a former territory of the Soviet Union, Moldova has its own language, culture, and traditions that date back to as early as the fourteenth and fifteenth centuries. In the post-Soviet era, Moldova has been involved in many border conflicts and disputes that have had a dramatic impact on the country. 

Since the 1990’s, Moldova has strengthened its presence by joining prominent partnerships such as: joining the United Nations, Council of Europe, World Trade Organization (WTO), Commonwealth of Independent States (CIS), Internal Bank for Reconstruction and Development (IBRD), Association with the European Union through the Duty and Comprehensive Free Trade Area (DCFTA) and the European Bank for Reconstruction and Development (EBRD).  As a result of these partnerships, Moldova has an appealing stability for multinational companies to participate in foreign direct investment. Moldova, along with other markets in the post-Soviet territory are experiencing booms in Information Technology, Manufacturing, and Logistics because of the affordable real estate, which in turn attracts more professionals to employment positions in Moldova. For this reason, real estate is a great investment in both residential and commercial properties due to the likelihood of the prices rising as more companies invest capital in Moldova. 

Advantages to Investing in 2018 
Ease of Investment
Moldova has made a great effort to make investing simple for prospective investors. One aspect they have focused on is signing of double taxation treaties with 48 countries. In addition to taxation treaties, the government in Moldova has signed 39 bilateral ease of investment treaties with several different countries. In addition to these treaties the Constitution in Moldova is designed to cater to the foreign investor by expressing a willingness to redact policies to uphold and protect foreign investment. Lastly, there has been a movement in Moldova to implement a gradual privatization in various sectors of their economy such as: housing, telecommunications, and energy sectors. This movement towards privatization lowers the risk for prospective investors as Moldova moves away from an economical structure that is heavily nationalized with a high risk of government interference. 

High Speed Internet Connectivity 
One benefit of Moldova is its rapid growth in the Information Technology and Telecommunications sectors. For this reason, it is quite easy and affordable to have a reliable Internet connection. For multinational firms, they have access to affordable rents and high-speed Internet to match. As global commerce continues to be dependent on reliable Internet, this affordable jurisdiction will become more appealing to multinational companies, which will in turn need real estate for their employees. Investing in real estate in both the residential, commercial, and industrial sectors is wise due to the demand that will occur as a result. 

Low Cost of Living 
Moldova is still an emerging market in many ways that is developing, yet still safe. In addition to the safety in Moldova, there is a very affordable cost of living compared to other countries in the European Union. The low cost of living is quite appealing for employees who could be transferred there by their employers, particularly if they are being paid from their home country’s standards in a locale with a lower cost of living. In terms of real estate investment, Moldova has had a great deal of growth in the 1990’s that was halted by the 2008 recession. That said, the real estate market in Moldova has stabilized considerably and as of 2013, investors are having significant yields on the properties that they invest. In particular, the capital city of Chisinau is considered to be the only city in Moldova with conditions appropriate for expatriates. The current price is 1,000 EUR per square meter, which lends the possibility of 13% rental yield for an apartment with 40 square meters. For medium-sized apartments, there is also a 11% rental yield. These numbers, combined with the ease of foreigner investors to acquire real estate make Moldova an attractive option as it recovers from the global financial crisis of 2008. 

Accessibility to Other European Countries
Given the proximity of Moldova to Europe, it is a natural attractive place for multinational firms to setup major offices for a fraction of the price. The lower rent and lower cost of living makes it possible to bring in expatriate employees along with recruit local employees to lower their overall cost. For real estate investors, there is a great market for these professionals that need housing in the capital city of Chisinau because the need will be perpetual and will likely continue to expand. Moldova is a great location because it is less expensive compared to other countries with close proximity to the European Union, yet still has the strategic and advantageous location. Lastly, as China expands its One Belt One Road Initiative across the Eurasian continent, countries such as Moldova will be gateway countries that have the potential to facilitate a great deal of commerce and growth within the region. 

Final Remarks
Chisinau, Moldova is rapidly becoming a hot spot for both real estate investors and multinational corporations alike. Due to the low cost of living, high yield on real estate investments, and strength in Information Technology and Telecommunications, it will be no surprise to see investment continue to flood into Chisinau, Moldova. For real estate investors looking to diversify their portfolios, it is highly recommended to consider the real estate options in Chisinau, Moldova. 

Jacquelyn Annete Garcia Vadnais is an Investment Consultant and field expert blogger for Barracuda Consulting.
Jacquelyn has a JD/MBA from Suffolk University, and LL.M in International Law from the University of Miami, and a B.A. from the George Washington University in International Affairs with a Concentration in International Politics. Jacquelyn speaks English, Spanish, French, and Portuguese and has lived in ten countries. Jacquelyn has done work for firms such as Boston Consulting Group and has worked with firms based in over ten countries in the fields of Real Estate, International Law, Expat Living, International Business, Forex Trading, and Travel. She has also volunteered her time and expertise at the Victims Rights Law Center based in Boston, MA.

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