12.02.2010 To Rent or to Buy with Mortgage

Imam Imot Magazine, vol.2, February 2010

Has the time come when more and more people in Bulgaria will prefer to rent a property than to pay big mortgage installments? At first glance we might be embracing this practice which has long been the case in many of the developed countries. Last year the ratio between the number of rental and sale property deals is 70 to 30. But still 2009 was the year of the peak of the economic crisis, the property sector was hit hardest and the number of concluded deals decreased drastically – by up to 50%. In the smaller towns the market was at a complete standstill, there was some activity in the big cities, mainly in Sofia and Varna. That is why for now sales agents are cautious in predicting whether there is a change coming in favor of renting – also a result of the more dynamic life we lead and people’s bigger mobility.

On the whole, the two things cannot be compared in view of the end result because the aim of the purchase of a real estate is not only to live in it but also to make a long-term investment, says Polina Stoykova, Chief Operations Manager of BULGARIAN PROPERTIES. However, both variants solve one and the same need people have – that of having a home.

The choice between renting out and buying depends on the financial status, the manager of a leading lending center comments. According to real estate agents one of the main factors tipping the balance in one or the other direction is how much people feel secure in their job right now.

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