As was true for the other former Soviet republics, in Moldova the state used to own and allocate all land and most buildings. After the break up of the Soviet Union, Moldova initially focused on privatizing state-owned property, but soon recognized that Soviet-era land and building registration systems would never effectively support real estate market development. Economic development was seriously impeded by insecurity about property rights and related institutional arrangements.
The First Cadastre project supported development and implementation of a national unified real estate registration program for urban and rural land, and establishment of a system of clear and enforceable ownership rights which promoted land privatization and real estate market development in Moldova. This would provide the government with a basis for future revenue generation mechanisms through property taxation (fiscal cadastre). The registration system was also a prerequisite for economic growth.
Secure ownership has meant increasing numbers of households and businesses can readily buy, sell, and inherit real estate or use it for collateral.
Highlights:
- According to the 2007 Doing Business report, Moldova ranked better than its neighbors on ease of land registration. 48 days are required to register property, whereas the average for Europe and Central Asia Region is 102.
- More than three-quarters of all real estate has been registered.
- Sales transactions quintupled from 17,907 in 1999 to 89,451 in 2005.
- The number of registered mortgages increased by a factor of twelve from 1999 to 2005.
- The new real estate registration system provides for the first time: Property owners with security of ownership rights such that they can sell or rent real estate at fair market prices and pass on their holdings as inheritances; commercial banks with the confidence to give secured credit against real estate; the real estate market with information on ownership, property location, and property values as needed for the market to function effectively; government agencies and institutions with basic information for urban planning and land management; the private sector with opportunities in areas related to real estate registration.
- IDA's ability to convene different donors and stakeholders enabled the project to become the primary point for donor cooperation in the sector and for coordination across the different government agencies. This was especially important for the donors, who had been working somewhat independently of one another and in some cases at cross purposes.
- Through the project IDA was able to promote a framework for sectoral policy reforms that found broad ownership not only within the Government but also among the relevant donors, who have continued to provide financial support well beyond the amounts originally envisioned.
- The total project cost was US$24.6 million, of which IDA provided US$15.9 million. IDA provided an additional US$3 million for the second project.
Other donors contributing to the project's goals included Norway (for public information), Switzerland (for equipment, technical assistance, and training for the mapping agency), and Sweden (technical assistance for project implementation, surveying, mapping, etc.); USAID provided parallel support through the Land Privatization Support Project.
It will be necessary to complete development of a business plan for the registry, which will (a) adjust the current registration fees to cover future projected operating costs; and (b) ensure registration of the remaining real estate (at project end about 85 percent of all real estate will have been registered), as well as to strengthen the linkages of the registry for property taxes and to make the registry information of more use for land planning and management.
First Cadastre Project and Additional Financing for Project Scale-Up (1998 - 2007)
Project documents I | II
RSS