Renting rates cheaper than mortgage costs
According to a study carried out by SFin, currently in Romania it is cheaper to rent then to get a mortgage. For example, in Drumul Taberei, one of the areas of Bucharest, the average price of a studio flat is €40,000 and the average monthly rent is €200. Twenty years of rental at these prices, would cost €48,000, where by getting a 20-year mortgage at the current interest rates you would pay a total of €59,000, equivalent to almost €50 / month in addition to the current rent fee. While these values are slightly different from an area to another, the conclusion of the study applies to most of the cases: renting proves to be a cheaper option than a mortgage.
These are good news for potential investors; however, these calculations do not include any market predictions (interest rates and flat prices over the next years) especially in the current situation, when Romania is going to join the EU in January 2007.
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Posted: October 2nd, 2006 under Apartments.
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