11.12.2009 The Bulgarian Property Market in 2009 - Latest Figures, Overview and Future Trends
Polina Stoykova, Chief Operations Manager, BULGARIAN PROPERTIES
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: firstname.lastname@example.org. 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.
TOP PUBLISHED OFFER
2-bedroom apartment for sale in Varna https://www.bulgarianproperties.com/2-bedroom_apartments_in_Bulgaria/AD19974BG_2-bedroom_apartment_for_sale_in_Varna.html
2-bedroom apartment in Briz quarter Briz quarter in Varna is famous for its peaceful atmosphere, beautiful panorama and fresh air. Recently it has ... read more
|170.00 m2||no||€ 105,000|
TOP SOLD OFFER
1-bedroom apartment for sale in Sofia https://www.bulgarianproperties.com/1-bedroom_apartments_in_Bulgaria/AD19907BG_1-bedroom_apartment_for_sale_in_Sofia.html
Furnished apartment close to the South Park This appealing one-bedroom apartment is located in one of the most peaceful regions of the capital, Lozenets ... read more
|100.00 m2||no||€ 100,000|
read more newsletters
Housing and consumer loans on the Bulgarian market recorded the strongest start of the year since 2009. They reported the most serious growth in January 2019 compared to the last decade, according to the data of the Bulgarian National Bank (BNB), reports money.bg
For the first month of the year housing loans rose by 11.1%. By comparison, in January 2018 their growth was within 8.2 p... read more
Sofia, Bucharest and Budapest are among the cities you can visit if you have a limited budget, according to an article by the low-cost Ryanair company.
The text highlights the advantages of these places and the exemplary prices for basic goods and services such as taxes, local beer, wine, coffee and food.
According to the authors Sofia is the perfect place for people... read more
Omnipresent, directed by Ilian Djevelekov, is Bulgaria’s foreign language film nomination for the 2019 Oscars, the National Film Centre has announced.
The plot of the film is centred on Emil, a writer and owner of an advertising agency and his obsession for spying on his family, friend... read more
All photos, texts, video clips, charts and banners on our website are property of our company or of our partners and are protected by the Copyright Act of the Republic of Bulgaria. Any unauthorized use of photos, texts, videos and other materials from our website by third parties will be subject to immediate claim on the part of the copyright owners. The information on our website is with information and advertising purposes. Alhtough we have made all efforts to provide accurate information, there may be some mistakes. For full and correct information is considered only the information received at the offices of Bulgarian Properties Ltd.