Average Property Prices Down by 36% in 2009

The average prices of properties in Bulgaria fell by 36% in 2009 year-on-year, an analysis of BULGARIAN PROPERTIES shows.

“The number of deals in 2009 decreased by 40% and investors postponed the purchasing of real estate and focused their attention to the search for bargain deals,” comments Polina Stoykova, the company’s Chief Operations Manager.

The real estate market follows directly the country’s economic development and when the economy starts coming out of the crisis the real estate market will start recovering as well. As a large part of the property deals are concluded with financing from outside sources – foreign buyers, Bulgarians living abroad, etc. it is possible that the recovery of the property market will outpace the real economic recovery by a few months, BULGARIAN PROPERTIES add.

We are to expect at least six more months of correction of the market prices and of few deals. Offer prices will continue to be corrected so they would reach the levels of the actual concluded deals, as this is a market mechanism of self-regulation. The sooner property prices reach their actual market levels the sooner will the number of deals increase.

The recovery of the market will be felt first in the increase in the number of deals, mainly with quality properties in Sofia and Varna and after that property prices will start increasing. We cannot talk of a price increase in the next year or so but when that happens prices will go up gradually, commensurable with the increase of the country’s GNP.

In short, in 2010 the market will have to finish the process of self-regulation and market price formation after which around the middle of the year we might witness a gradual increase in the number of concluded deals.

It is important to underscore that one mustn’t think that the property market in Bulgaria has collapsed. On the contrary, it is undergoing a specific development phase, the mistakes that were made during the fast growth in the last few years are being corrected and the trends follow the general economic situation not only in Bulgaria but in the world. At present the market is calm and offers good possibilities due to the more sensible prices and the big supply of quality properties. Everyone who is interested and has the means to buy a property can do so in an informed and unrushed way.

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