Contacts
0

NEWSLETTER

2009-12-10

11.12.2009 The Bulgarian Property Market in 2009 - Latest Figures, Overview and Future Trends

The end of a very tough year is coming and here is our overview of what has happened to the Bulgarian property market in 2009 and what we can expect for next year.

1. Latest figures

The month of November was more dynamic than we expected and there were some interesting trends.

Firstly, the total number of deals BULGARIAN PROPERTIES realized in the country is only 15% less compared to October. This result differs from previous years when the number of new deals in October was always much higher compared to November.

The other interesting outcome on the market is the type of deals concluded in the big cities – they are mainly in the high price segment of 100,000 Euro and more. For example, in November in Sofia were purchased mainly apartments with an area of over 100 sq.m. at prices between 100,000 and 250,000 Euro, at an average price of 1,100 Euro/sq.m. This trend is quite the opposite compared to October when small apartments were purchased in Sofia, at prices between 55,000 and 65,000 Euro or an average of 800 Euro/sq.m. This trend is also true for Varna but the deals there in November were in the low price segment - between 20,000 and 30,000 Euro. The trend for the conclusion of deals in the lowest and highest price segments applies for the whole country in 2009. The properties in the mid price segment continue to be rare.

The realized rental deals with residential properties in Sofia in November follow the same trend as the sales – what buyers prefer are more expensive apartments compared to October when the rented apartments were at prices 25% lower than in November. The situation in Varna is different – there in November the rented apartments were at a lower price compared to the previous month.

The third important trend on the property market in November is that for the first time in 2009 the number of concluded deals is higher compared to the same month in 2008. In November 2009 BULGARIAN PROPERTIES realized almost 38% more deals compared to November 2008. On the one hand, this is understandable as in November 2008 the crisis was already a fact and the market had entered a period of continuous decrease. On the other hand, we can say that there are some stabilization indicators on the property market as the number of realized deals in the second half of 2009 remains relatively stable on a monthly basis.

What is important to be noted is that November also surprised us with a more dynamic seaside holiday property market which has not been typical for the winter season in the last few years. There are deals both on the northern and southern seaside, with properties both in the low and high price segment.

The second most active group of buyers after the Bulgarians continues to be the British, followed by Russians and Russian-speaking clients. Apart from them deals are also concluded with buyers from various nationalities – Greeks, Slovaks, Czechs, Germans, Cypriots, Italians, even Australians, Americans and South Africans.

2. The most important events on the market in 2009 – a year after the beginning of the crisis, are as follows:

• 40% decrease in the number of concluded deals in the country for the period January-November 2009 compared to the same period in 2008;
• 32% decrease in the average price of concluded deals with residential properties in Sofia in 2009 until the end of November compared to 2008 (65,400 Euro in 2009 compared to 96,200 Euro in 2008);
• 13% decrease in the rental levels of residential properties in Sofia (for the period January-November 2009 compared to the same period in 2008) and retention of the rental levels in Varna;
30% decrease in the rental prices of commercial properties (offices and shops) in Sofia and Varna;
• Over 50% decrease in the prices of Bansko apartments and 30% decrease in the prices of Sunny Beach apartments;
• 35% decrease in the average price of rural properties around the country for the period January-November 2009 compared to the same period in 2008.
• An increasing number of offers with discounted prices.

3. Trends in 2010

In the last year due to the deepening of the economic crisis and the shock which people suffered as a result of the insecurity of their income many of the property deals did not take place. A large part of potential property buyers put off their plans of buying a real estate. If the good news about the coming out of the crisis continues and people start feeling more secure, a large part of the postponed purchases will start to be realized in 2010.

The property market follows directly the development of the country’s economy so when the economy starts coming out of the crisis the real estate market will start recovering as well. As most of the deals are concluded with funding from foreign sources – foreign buyers, Bulgarians working abroad, etc, it is possible the recovery of the property market to forestall the actual economic recovery of the country by a few months.

According to the forecast of the Bulgarian Finance Minister the economy will start recovering in May 2010 which means at least another 6 months of falling prices and fewer deals. The process of correction of offer prices will continue until they reach the level of the prices of the actual concluded deals as this is the market’s self-regulating mechanism. The faster the property prices get to the actual market levels the sooner the number of realized deals will start increasing. The first signs of the market’s recovery will be the increased number of deals mainly with quality properties in Sofia and Varna and only after that will the prices start increasing. We cannot talk of price increase in the next year or so but when this happens the prices will increase gradually, proportionally to the increase of the country’s GDP.

To put it in a nutshell, in 2010 the market will have to finish the process of self-regulation after which around mid 2010 we should witness a gradual increase in the number of property deals.

It is important to be stressed that people shouldn’t see the property market as something in ruins, as something in total collapse. On the contrary, there will always be a property market, but we would not be able to survive a sudden price soar similar to that from the property price boom period. The market is calm and there are good property offers due to the more sensible prices and the bigger supply of quality real estate.

---
Copyright: 2009 Bulgarian Properties Ltd. All rights reserved. For further information or advice please contact us on tel: +359 2 9 11 50 or e-mail: info@bulgarianproperties.com. The use of this article by third parties is allowed only with proper quotations of the source www.BulgarianProperties.com and the Author of the article. The data in this material has been collected by the Author and Bulgarian Properties Ltd. and is presented for information purposes only. We have made every effort to ensure the accuracy of the data. However, Bulgarian Properties Ltd. cannot be held responsible for loss or damage as a result of decisions made based on this article.
© Bulgarian Properties Ltd. 2009.

Share
Borovets Gardens 2 - the second phase of the popular complex
Feel at home in Borovets! Buy your own vacation apartment in one of the best rated complexes in this top mountain resort. Progressing construction with planned completion in December 2020 for the new winter season. A wide range of available apartments at attractive prices, suitable for rental income.
See More
Come for video viewings of properties in Bulgaria!
Only on our website you will find thousands of properties situated all around Bulgaria for which we have shot videos. Don't waste time, view them online - on your phone, laptop or tablet, at a convenient time and without the need for an inspection trip and personal visit. Welcome for video viewings with BULGARIAN PROPERTIES!
See More

More News

latest news
Housing in Bulgaria's Capital Sofia Rose by 49% Within Four Years

Housing in Sofia rose by 48.6% in four years. This ranks the capital in first place among the major cities in the ranking of property prices. The prices of newly built apartments in Sofia in the first quarter of the year are 43.3% higher than in 2015, according to data from the National Statistical Institute. In the case of existing apartments, the increase for the same period is much higher - by ...

09 September, 2020
Company news
BULGARIAN PROPERTIES Agents of September 2020

🌞 August was the MONTH of the MONTHS with a record-high 📈 activity on the Bulgarian real estate market and excellent results of our offices throughout the country.
And Ivan Krumov was the AGENT of the AGENTS with sales volume in the 🏗 new phase of the hit complex ⭐Park View Residence⭐, which only a few manage to make for a whole year! In just two months...

03 September, 2020
Company news
BULGARIAN PROPERTIES has become a Gold Member of PropTech Bulgaria

We are proud do announce that we have been become a GOLD MEMBER of PropTech Bulgaria - the PropTech Hub of Bulgaria, officially representing the largest international PropTech organizations, as well as Bulgaria in these organizations.

We have been recognized as construction and real estate innovators and we are happy to be able to contribute to the technological development in the ...

03 September, 2020
latest news
CNN Travel - Bulgaria: Wild majesty in one of Europe's oldest countries

(CNN) — For more than a century, Bulgaria has had little trouble enticing people to its beach resorts scattered along the Black Sea coast. City-breakers head to its main cities -- including Sofia, the capital, and Plovdiv, the 2019 European Capital of Culture -- for an enjoyable blend of culture and hearty Bulgarian gastronomy.

Rila National Park -- the country's large...

31 August, 2020

REQUEST DETAILS