diff --git a/rhodecode/lib/db_manage.py b/rhodecode/lib/db_manage.py
--- a/rhodecode/lib/db_manage.py
+++ b/rhodecode/lib/db_manage.py
@@ -348,18 +348,41 @@ class DbManage(object):
             self.sa.rollback()
             raise
 
-    def config_prompt(self, test_repo_path=''):
-        log.info('Setting up repositories config')
+    def config_prompt(self, test_repo_path='', retries=3):
+        if retries == 3:
+            log.info('Setting up repositories config')
 
         if not self.tests and not test_repo_path:
             path = raw_input('Specify valid full path to your repositories'
                         ' you can change this later in application settings:')
         else:
             path = test_repo_path
+        path_ok = True
 
+        #check proper dir
         if not os.path.isdir(path):
-            log.error('You entered wrong path: %s', path)
+            path_ok = False
+            log.error('Entered path is not a valid directory: %s [%s/3]',
+                      path, retries)
+
+        #check write access
+        if not os.access(path, os.W_OK):
+            path_ok = False
+
+            log.error('No write permission to given path: %s [%s/3]',
+                      path, retries)
+
+
+        if retries == 0:
             sys.exit()
+        if path_ok is False:
+            retries -= 1
+            return self.config_prompt(test_repo_path, retries)
+
+
+        return path
+
+    def create_settings(self, path):
 
         self.create_ui_settings()
 
diff --git a/rhodecode/websetup.py b/rhodecode/websetup.py
--- a/rhodecode/websetup.py
+++ b/rhodecode/websetup.py
@@ -40,7 +40,7 @@ def setup_app(command, conf, vars):
     dbmanage = DbManage(log_sql=True, dbconf=dbconf, root=conf['here'], tests=False)
     dbmanage.create_tables(override=True)
     dbmanage.set_db_version()
-    dbmanage.config_prompt(None)
+    dbmanage.create_settings(dbmanage.config_prompt(None))
     dbmanage.create_default_user()
     dbmanage.admin_prompt()
     dbmanage.create_permissions()