Buying Romanian property with a complicated history

Many of the most attractive investment opportunities in Romania are not brand-new developments, but older buildings in central locations, historic villas, or large plots of land on the edge of growing cities. These assets often come with a “complicated history”: nationalisations during the communist period, partial restitutions after 1990, court disputes between heirs scattered around the world, overlapping titles or unfinished cadastral works.

For foreign investors, Romania’s real-estate market can look fundamentally sound: a modern Civil Code, a centralised land book system, and years of growth in major cities such as Bucharest, Cluj-Napoca, Timișoara or Iași. Yet, behind clean-looking brochures and glossy renderings, some properties still hide legal and practical risks that are very specific to the post-communist context. Ignoring these risks or applying “standard” due diligence models from Western Europe can be an expensive mistake.

This guide focuses on foreign buyers interested in Romanian real estate that is not “plain vanilla”: old apartment blocks, historical townhouses, land previously used by state-owned enterprises, properties that passed through restitution procedures, or assets with co-owners and heirs living abroad. Our aim is not to scare you away, but to show how a disciplined approach can turn a risky asset into a manageable (and often very profitable) investment.

We will look at four key themes:

how Romanian restitution laws continue to affect current owners and transactions today;
how to verify whether a property has been the object of past claims or ongoing litigation;
how co-ownership and missing heirs abroad can block or complicate an acquisition;
a practical due diligence checklist tailored for foreign buyers dealing with “complicated history” properties.

The analysis is based on Romanian restitution legislation (in particular Law no. 10/2001, Law no. 247/2005 and Law no. 165/2013), Civil Code rules on property and co-ownership, and current real-estate practice. It does not replace a property-specific opinion from a Romanian lawyer, but it should help you ask the right questions and spot the main risk areas early.

Restitution Laws and Their Impact on Current Owners

After the fall of communism, Romania adopted several waves of laws to deal with properties taken abusively by the state between 1945 and 1989. These acts created restitution and compensation mechanisms that have been functioning (with many delays and reforms) for decades. Although a large part of the process has been completed, restitution law still shapes the risk profile of many properties on the market.

1. Historical background in a nutshell

Between 1945 and 1989, numerous properties in Romania were nationalised, expropriated or otherwise taken over by the state or state-controlled entities. Private owners often received little or no compensation. After 1989, successive governments tried to correct these injustices. The most relevant laws for urban real estate are:

Law no. 10/2001 on the legal regime of certain immovable properties taken over abusively during the communist regime (urban buildings and land);
the land fund laws (Law no. 18/1991, Law no. 1/2000 and subsequent amendments) regarding agricultural and forest land;
Law no. 247/2005, which reformed the system and introduced mechanisms for compensation in cases where restitution in kind was not possible;
Law no. 165/2013, which reorganised the procedure, imposed deadlines and introduced a points-based system for compensation.

These laws created rights for former owners (or their heirs) to request restitution in kind where possible, and compensation (now typically in the form of points convertible into money or shares) where physical restitution is no longer available.

2. How restitution laws affect today’s owners

From a foreign buyer’s perspective, the key question is: “If I buy this property, could someone later claim that it should have been restituted to them and try to undo my purchase?” The short answer is that most restitution processes are now advanced, but risks still exist, especially for certain categories of assets.

Restitution laws affect current owners in several ways:

Restituted properties – assets already returned to former owners or heirs under Law no. 10/2001 or land laws. These are normally safe in terms of restitution risk, but the chain of title after restitution must be carefully checked (including any challenges to the restitution decision).
Compensation-only properties – properties that could not be restituted in kind because they were sold to tenants, developed, demolished or used for public infrastructure. Here, former owners receive compensation; the property stays with the current owner (usually the state or a private buyer). Risk focuses on whether the classification as “not restituable in kind” was solid.
Properties still under claim – cases where notifications under Law no. 10/2001 or land laws were submitted, but the process has not been fully finalised, or where decisions were challenged in court. These are the most sensitive for investors.
Properties “touched” by partial restitutions – large plots subdivided over time, where some parts were restituted and others not, or where boundaries moved. Here, cadastral and urban planning documentation must be reconciled with restitution files.

In practice, many urban buildings and plots of land in central areas were subject to nationalisation and later to restitution claims. Even if the current land book shows a clear chain of title, a thorough check of restitution history is essential before signing a sale-purchase agreement.

3. Why a clean land book is not always enough

Romania uses a land book (carte funciară) system administered by the National Agency for Cadastre and Land Registration (ANCPI). In principle, entries in the land book are presumed to be correct and complete. However, especially for older properties, the land book may not reflect the full restitution story.

Typical issues include:

Delayed or incomplete registration – decisions on restitution or compensation may exist in administrative files but not yet be fully reflected in the land book.
Omissions of claims – the fact that someone filed a restitution claim does not automatically mean that a note was made in the land book. Many early claims were processed at the level of city halls without immediate land book correspondence.
Overlapping titles – due to errors or the complexity of reforms, there are situations where the same plot (or overlapping parts) appears within different chains of title in cadastral records.
Registered encumbrances that require interpretation – land book entries referring to “claims under Law no. 10/2001” or “notes regarding litigation” need to be understood in context: what exactly was claimed, by whom, and with what outcome?

This is why Romanian practice relies on a combination of land book checks, administrative file reviews and court record searches. Only when all three are aligned can a buyer be relatively confident that no restitution bomb is hidden in the background.

4. Residual risks: is restitution still ongoing?

Law no. 165/2013 aimed to put an end to the “never-ending” restitution process by setting deadlines and centralising compensation through the National Authority for Property Restitution. Many local procedures are now closed, but not all. Court challenges can still appear, especially where former owners contest classification decisions (for example, that a property cannot be restituted in kind), the scope of the asset, or the valuation of compensation.

For foreign buyers, the consequence is that you should treat any reference to restitution in the property’s past as a red flag, not necessarily a deal-breaker. With proper document review and contractual protections, it is often possible to manage the risk. But assuming that “if it’s in the land book, it must be fine” is not safe for this category of assets.

How to Check for Past Claims and Litigation

A good Romanian property due diligence goes beyond the land book extract. For “complicated history” properties, you need to investigate what happened before the current entry and whether there are pending claims that have not yet reached the land book. The process has several pillars.

1. Land book and cadastral records

The starting point is a fresh land book extract (extras de carte funciară pentru informare) and the corresponding cadastral documentation. These documents show:

the description of the property (surface, destination, buildings);
the current owner and, where applicable, co-owners and their quotas;
encumbrances (mortgages, easements, pre-notations of promises to sell, leases, seizure orders);
any notes about litigations, restitution claims, or special laws applicable to the property.

For properties with a long history, it is essential to look not only at the current state but also at the historical entries: previous owners, past subdivisions and mergers of plots, and when exactly changes occurred. This often requires a full historical extract or access to the underlying land book pages (sometimes still in paper form at local offices).

Red flags in land book and cadastral documents include:

references to “Law 10/2001” or other restitution laws;
notations about pending lawsuits or court orders affecting ownership;
recent corrections of surface or boundaries without clear explanation;
existence of multiple property identifiers for what appears physically as a single asset.

2. Restitution files at local authorities

Most urban restitution claims under Law no. 10/2001 were handled by city halls and other local authorities acting as “holders” of properties. They kept files containing notifications submitted by former owners or heirs, supporting documents, decisions to restitute (or not), correspondence with the National Authority for Property Restitution, and sometimes settlement agreements.

When a property is suspected of having a restitution history, legal due diligence should include a formal request to the competent local authority to clarify whether:

any notifications under restitution laws were filed for that property (identifiable by address and/or old cadastral references);
if so, which decisions were issued (restitution in kind, rejection, compensation, mixed solutions);
whether any decisions are currently under challenge in court;
whether there are pending files not yet decided.

The answer may take time and sometimes is incomplete; in such cases, a follow-up on-site review of the file may be necessary. Nonetheless, this step offers an additional level of comfort beyond the land book.

3. Court records and pending litigation

The third pillar is verifying whether the property (or its current owner) is involved in court disputes relating to ownership, restitution, boundaries, or related issues. Romania has a public court portal where anyone can search for cases by party name and, in some courts, by keywords related to the object or address.

In practice, an experienced real-estate lawyer will:

search the seller’s name (and, where relevant, previous owners) in the court portal for property-related cases;
combine this with searches by address or old cadastral identifiers where available;
request copies of relevant decisions and, if necessary, the full case file from the court records office.

Not all historical cases are fully digitised, and some older disputes may only be visible in physical archives. Nevertheless, the exercise often reveals ongoing appeals or cassation proceedings that have not yet resulted in a final, enforceable judgment but could affect the transaction if the buyer is not aware of them.

4. Sellers, tenants and neighbours as information sources

While legal sources are essential, “soft” sources of information can also signal hidden risks:

Sellers should be asked directly (and in writing) about any past and ongoing restitution claims, disputes with neighbours over boundaries or access, or attempts by heirs to challenge previous transfers.
Tenants or occupants may know about family conflicts, previous owners knocking on the door, or court documents received at the property address.
Neighbours sometimes know surprisingly much about the history of a building or plot, especially in old neighbourhoods where people have lived for decades.

These informal channels should not replace legal checks, but they can help focus the due diligence on specific periods or persons and sometimes reveal issues that the official record has not yet fully captured.

5. Example: the “quiet” building with a noisy past

Imagine you are considering buying a 1930s apartment building in central Bucharest, fully leased, with a seemingly clear land book: current owner is a private company, no mortgages, no annotated lawsuits. During due diligence, your lawyer sends requests to the city hall and discovers that the building was nationalised in 1950, that multiple restitution claims were filed under Law no. 10/2001, and that the city hall initially rejected them, but several heirs obtained court judgments forcing partial restitution.

Some apartments have been restituted and then sold on. Others are still subject to pending cases where courts will decide whether the heirs are entitled to restitution in kind or only to compensation points. The current owner bought the building from a state-owned entity in the 1990s and has been involved in various litigations with former owners since.

On the surface, nothing in the land book alerted you to this complexity. Without restitution file and court record checks, you might have acquired a building where several apartments could be returned to heirs, dramatically impacting your rental income and investment thesis.

Co-Ownership and Missing Heirs Abroad

Another typical element of “complicated history” is co-ownership. Many Romanian properties belong to several heirs as co-owners (coproprietari), sometimes scattered across different countries. The Civil Code allows co-ownership but imposes strict rules on how co-owners can dispose of the entire property.

1. Co-ownership basics under the Civil Code

Under the Romanian Civil Code, co-ownership is a situation where two or more persons have simultaneous ownership rights over the same asset, each with a share (quota) expressed in fractions or percentages. Co-owners share benefits and burdens proportionally, but certain decisions require unanimity.

In particular, selling the entire property normally requires the consent of all co-owners. One co-owner cannot unilaterally transfer more rights than they hold. If a sale is signed only by some co-owners, the buyer obtains at best their shares, not full and free title, unless other mechanisms (such as judicial partition or acquisition by prescription) are later used to consolidate ownership.

Co-ownership can arise for many reasons: inheritance without partition, gifts to several children, purchases made together by spouses or partners, or partial restitutions where some heirs claimed and others did not. From an investor’s perspective, co-ownership is not inherently bad, but it must be mapped and understood.

2. The problem of missing or unknown heirs

In properties with a long history, it is common to encounter situations where one or more heirs live abroad, cannot be located, or have died without clear succession being opened in Romania. Sometimes, the seller is only one heir (for example, a grandchild) who claims to “speak for the family” but has no formal power of attorney or court mandate.

Key risks include:

Incomplete title – if only one heir signs the sale and others never formally renounced or transferred their shares, your title can be partially defective, leaving room for future claims.
Heirs discovered after the transaction – a distant relative living in another country may later open succession and claim an undivided share of the property, attacking past sales.
Invalid powers of attorney – powers of attorney issued abroad must respect Romanian formalities (authentication, apostille or consular legalisation, and sometimes translation); sloppy documentation can later be challenged.

These risks are accentuated where families were displaced during or after the communist period, or where previous owners emigrated decades ago and now have descendants in multiple jurisdictions.

3. Legal tools to deal with absent co-owners

Romanian law offers several mechanisms that can, in some cases, mitigate the co-ownership and missing heir problem, for example:

Succession procedures – heirs can open or finalise succession proceedings, either before a notary public or in court, to clarify who owns what share. Foreign documents (wills, foreign succession certificates) can be recognised and used in Romania if formalities are observed.
Judicial partition – co-owners can request the court to divide the property or allocate it to one of them with monetary compensation to the others. In some situations, long-term refusal by a minor co-owner or an absent heir to cooperate can be dealt with via judicial decisions.
Curators for absent persons – if a co-owner’s whereabouts are unknown, courts can appoint a curator to represent their interests in specific proceedings. This does not allow that curator to “sell” the property, but it can help move partition or rectification procedures forward.
Prescription (acquisitive limitation) – in certain conditions, someone in open, continuous, uninterrupted and exclusive possession of a property over a legally defined period may acquire ownership by prescription. This is complex and fact-sensitive and cannot simply be assumed; a court declaration is usually needed to make it robust for investors.

From a transactional standpoint, these tools are useful mainly to prepare a property for sale. As a buyer, you should insist that the seller cleans up co-ownership issues before closing (for example by giving time to finalise a succession or partition), rather than hoping to fix them after you have paid the price.

4. Typical red flags in co-ownership situations

When reviewing a property with multiple owners or a long family history, foreign buyers should watch for:

long lists of co-owners in the land book, some with unknown addresses or clearly living abroad;
discrepancies between the list of heirs stated by the seller and those appearing in official documents;
powers of attorney issued many years ago, without clarity on whether the person is still alive or capable;
unregistered family agreements or handwritten “division” documents not signed before a notary;
children or other potential heirs who are not mentioned at all, but may exist under applicable family law.

Any of these elements justifies deeper investigation and, often, specific contractual protections, such as indemnities or escrow arrangements.

Practical Due Diligence Checklist for Foreign Buyers

How can a foreign investor translate these legal and historical risks into a practical due diligence plan? The following checklist is not exhaustive, but it reflects the main steps used in sophisticated Romanian real-estate transactions involving properties with complicated histories.

1. Pre-selection and red flag screening

Before committing significant resources, conduct a high-level screening to decide whether a property is even worth full due diligence. At this stage, you can:

obtain a basic land book extract and cadastral map for the property;
ask the seller for copies of their title deeds and any major historical documents;
review urban planning information (zoning, building permits, heritage protection status);
ask a local lawyer for a preliminary view on whether the area or type of asset is known for restitution disputes.

If early screening reveals multiple red flags (for example, ongoing lawsuits and unresolved restitution claims), you can negotiate a longer due diligence period, price adjustments, or walk away at an early stage.

2. Core legal documentation

For properties that pass initial screening, the core due diligence package should include at least:

Updated land book extract for each cadastral number (including historical entries where relevant);
Cadastral plan and technical documentation to confirm boundaries, surfaces and building footprints;
Chain of title going back at least to the early 1990s (or earlier if feasible), including sale-purchase contracts, donation deeds, inheritance certificates, court judgments, restitution decisions, and privatisation documents;
Urban planning and building documents – zoning plans, planning certificates, building and use permits, heritage classifications where applicable;
Leases and occupancy documents for rented buildings, including any pre-emption rights or long-term leases that may limit redevelopment.

For older buildings in city centres, you should expect that the chain of title will involve multiple owners, restitutions or partial restitutions, and maybe even privatisation of former state-owned enterprises. The goal is to verify that each transfer was valid and that no obvious gaps or contradictions exist.

3. Restitution and litigation checks

To address restitution and litigation risks, your due diligence should include:

formal requests to local authorities (city hall, county authorities) to confirm the existence and status of restitution claims or decisions relating to the property;
searches in court databases for cases involving the current and previous owners, focusing on property, restitution, expropriation or boundary disputes;
requests for copies of key judgments, settlement agreements or administrative decisions, and legal analysis of their implications for the transaction;
verification of whether all relevant decisions are final and enforceable (no pending appeals or annulment actions).

If serious restitution risks are identified (for example, pending lawsuits where former owners seek restitution in kind), you may choose to (i) walk away, (ii) structure the transaction in tranches with conditions precedent, or (iii) negotiate strong indemnities from the seller backed by guarantees or escrow.

4. Co-ownership and succession analysis

Where co-ownership and heirs abroad are involved, due diligence should:

map all co-owners and their quotas as per land book and succession certificates;
verify that all co-owners are correctly identified, alive, and able to act (or formally represented by valid powers of attorney);
review foreign documents (wills, succession certificates, powers of attorney) for formal validity under Romanian law, including apostille/legalisation and translation;
check for evidence of family disputes or claims by “forgotten” heirs (for example, court actions to annul succession certificates or sales);
assess whether any clean-up steps (succession finalisation, partition, rectification of land book entries) should be completed before closing.

In practice, foreign buyers often require that the seller delivers a property with “clean” co-ownership: either all co-owners sign the sale, or a prior partition allocates the asset fully to the selling party. If this is not possible, careful structuring is needed to ensure that the buyer is not exposed to unmanageable future claims.

5. Contractual protections in the sale-purchase agreement

No due diligence can eliminate all risk. This is why contractual protections are critical in Romanian transactions involving properties with a complicated history. Typical clauses include:

Extensive representations and warranties on ownership, absence of undisclosed claims and litigation, restitution status, and co-ownership issues;
Specific indemnities for identified risks (for example, a pending lawsuit where the seller undertakes to cover any loss if the buyer’s title is affected);
Conditions precedent requiring the seller to obtain certain documents, final decisions or land book rectifications before closing;
Retentions or escrows – a portion of the price is held back for a defined period to cover potential claims arising from the property’s history;
Termination rights if major adverse claims arise between signing and closing.

Romanian notaries will often focus primarily on the formal validity of the sale deed and land book registrations. It is usually the buyer’s lawyer who structures these more sophisticated protections and ensures they are compatible with mandatory rules and notarial practice.

6. Role of local advisers and cross-border coordination

For foreign investors, a successful transaction typically involves a small team of coordinated advisers:

a Romanian real-estate lawyer who leads the due diligence, negotiations and structuring;
a notary public, chosen early, who confirms what they will require to authenticate the sale and register it in the land book;
technical experts (architects, surveyors) to confirm that cadastral documentation matches reality and that future development plans are compatible with zoning and heritage rules;
tax advisers, especially where the investor uses cross-border holding structures or where the transaction is part of a wider restructuring.

For properties with heirs abroad, foreign lawyers in the relevant jurisdictions may also be needed to obtain and validate succession certificates, wills and powers of attorney in a way that Romania will recognise. The more complicated the history, the more important early coordination becomes.

7. A simple risk-rating approach

Given the number of moving parts, it can be helpful to classify properties using a simple “traffic light” system during due diligence:

Green – no traces of restitution claims, clean land book and clear chain of title, no co-ownership issues, no pending litigation. These properties are closest to “plain vanilla”.
Amber – some restitution history or co-ownership issues, but with clear documentation and manageable risk; contractual protections and possibly small escrows are sufficient to proceed.
Red – significant unresolved restitution disputes, unclear co-ownership, major gaps in chain of title, or serious litigation risk. These may only be suitable for buyers with high risk appetite and deep local management capacity, or they require major conditions precedent before signing.

This kind of classification helps foreign investment committees understand why two buildings with similar physical characteristics can have very different legal risk profiles and therefore different prices and return expectations.

Conclusion: Turning Complexity into Opportunity

Buying Romanian property with a “complicated history” is not for everyone. It involves navigating restitution laws that still echo the communist past, understanding co-ownership structures shaped by decades of family events and migration, and dealing with gaps and inconsistencies in historical documentation.

However, with the right approach, this complexity can be turned into opportunity. Many local investors avoid such assets because they seem too risky or too time-consuming. Foreign buyers who invest in high-quality legal and technical due diligence, work with experienced Romanian advisers and structure transactions carefully can unlock value others overlook.

The key is to treat the property’s history as a core component of the investment thesis, not as an afterthought. If you understand where the restitution process stands, who the true owners are (including heirs abroad), and which litigations exist or might be started, you can take informed decisions: what price to pay, what protections to require, and whether to walk away from a deal that simply cannot be repaired.

In a market where unique historic buildings and well-located urban plots are increasingly scarce, being able to handle legal complexity is a competitive advantage. Romania’s legal system, while sometimes slow, offers tools to clarify and protect property rights. Used wisely, these tools allow foreign investors to build portfolios in prime locations while keeping restitution and co-ownership risks under control.