10.12.2010 The Bulgarian Property Market – 2010/2011 – Trends and Perspectives
It is true that 2010 also brought the so-expected stabilization on the Bulgarian real estate market and as a whole it was more successful than 2009. However, it didn’t manage to convincingly end the drop in real estate prices. According to BULGARIAN PROPERTIES data the additional discounts in the asking prices of properties this year were about 5%. The drop in property prices on the basis of concluded deals also slowed down and the average percentage for the country in 2010 is expected to be about 10% year-on-year, as this percentage varies for the different market segments between 2 and 15%. This trend is backed up by the National Statistical Institute data according to which the decrease in apartment prices around the country for the third quarter of 2010 is 6.04% (year-on-year, nominal value) and 8.3% with inflation.
In the luxury property segment prices in 2010 remained stable and were similar to those in 2009. In 2010 the market segmentation cycle finished and elite properties formed as a separate investment instrument which will not be susceptible to the general trends, especially to short-term fluctuations. We expect that apart from Bulgarian investors many foreign buyers will enter this market segment.
The main trends on the property market in Bulgaria in 2010 are as follows:
• Increase in the total number of property deals compared to 2009 by about 10% - after big fluctuations on the market and plummeting of the number of deals on a monthly basis the final result will be an increase in the number of deals around the country in 2010. This signal can be seen as the first positive sign of recovery but one should also take into consideration the fact that the increase in the number of deals is recorded on an annual basis on the background of slow first months in 2009. The recovery will first start with an increase in the number of deals and only after that with an increase in prices.
• Increase in the market dynamics in the capital Sofia and the other big cities in Bulgaria although compared to the dynamics in Sofia the market in the other regional cities is quite slow.
• Increase in the deals with beach properties by 20% compared to the deals in the summer of 2009. There is no change in the prices and preferences of the buyers compared to 2009 and to the previous quarters in 2010
• Growing interest towards holiday apartments at bargain prices
• Decrease in the interest in rural properties and continuing drop in their prices
• Increase in the share of the Russian buyers with 40% compared to 2009
• Complete absence of British buyers on the market in Bulgaria in 2010
• Narrowing of the nationalities buying properties in Bulgaria and more active buyers in the face of Bulgarians and Russians.
We still can’s say there are convincing signals that the property market is coming out of the crisis because people have not felt the effect of the recovering economy in the country yet. Buyers are willing to conclude deals but their insecurity quite often predominates and they put off the purchase of a property.
What are the most popular (most traded) types of apartments in Bulgaria in 2010?
They can be divided into 3 groups:
• Apartments in the capital of Bulgaria – Sofia. Their area is between 50 and 100 sq.m. priced between 35,000 and 90,000 Euro, as most buyers prefer to buy a larger apartment but at a lower price per sq.m. The demand continues to be focused on the southern and eastern parts of the capital.
• Apartments in the other big cities in Bulgaria - at prices between 25,000 and 40,000 Euro or 500-600 EUR/sq.m.
• Holiday apartments – the demand was mainly from foreign buyers (mainly Russians) at prices between 20,000 and 40,000 Euro. There was interest in all resorts along the northern and southern Black Sea coast in properties at bargain prices.
Latest data for the Bulgarian property market
November was quite successful as it was the markets in Sofia and Varna that were the most dynamic. However, the market in the beach resorts continued to be dynamic as well. In Sofia there was more interest in deals both in the lower and in the higher price segment.
At present apartment buyers in Sofia are divided into 2 groups – buyers of apartments at prices between 730 and 900 EUR/sq.m. and buyers of luxury properties which were sold at prices between 1,100 and 1,400 EUR/sq.m. The average price of the apartments bought in November 2010 in Sofia is 1,000 EUR/sq.m. which is higher compared to the average price in the third quarter of the year (840 EUR/sq.m.). This is so because the luxury segment market was more dynamic. What is typical is that a deal is concluded after the asking price is discounted by 5-10%.
The apartments sold in the luxury segment are priced between 130,000 and 170,000 Euro and those in the mass market segment – between 45,000 and 70,000 Euro.
The other types of properties which were bought last month are mainly cheap properties – holiday homes and rural houses between 3,000 and 40,000 Euro in various parts of the country. The interest in quality houses which are ready to live in priced about and over 45,000 Euro is also returning.
Forecast for 2011
At present positive economic news is very important. If the economy goes in the right direction our forecast for 2011 is that the market will overcome the shock from the dramatic price drop in 2009, property prices will remain stable, the number of deals will increase and from the end of 2011 till the spring of 2012 property prices will start increasing by 2-5% . As the market is already well segmented we can expect some diversions from this trend in the different segments. However, what is common for all segments is that prices have already reached the bottom or are very close to reaching it as in some cases there may even be signs of recovery.
Advice to buyers
The main advice to the buyers is to be active on the market and to assess the different possibilities pragmatically because now is a good time to buy a property. Even if the market has not reached the bottom it is very close to reaching it and waiting too much might lead to missing great possibilities. The supply at bottom prices will be very limited and buyers should not risk waiting too long. The best time to buy a property is just before prices hit the bottom or even some time after that because in the long run prices will start increasing and buyers will not lose from buying the property at a price that is slightly higher than the absolute minimum.
Copyright: 2010 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. 2010.
We are slowly returning to our normal everyday lives and the Bulgarian property market is experiencing a growing demand and a rising volume of deals after the corona virus lockdown.
Here are the present market trends which mark the start of a new beginning for the property market in Bulgaria:
🔵 Technology stays with us to help us in the new reality! We will ne...
The average selling price of residential properties in Bulgaria's capital Sofia increased by 4.0% on an annual comparison basis in the first quarter of 2020, local company Bulgarian Properties said.
The average price of dwellings in Sofia reached 1,120 euro ($1,219) per sq m in the first quarter, the realtor said in a quarterly property market analysis published last week.
High activity during the first 3 months of the year and acceleration of the price growth to about 4% on an annual basis. This is how the real estate market in the Bulgarian capital of Sofia developed until mid-March, when the state of emergency was introduced and many economic activities where put on hold.
Average Prices and Annual Change
In the first quarter of 2020...
BRITS could return to Bulgaria's Sunny Beach as soon as July as the country reduces its lockdown measures.
To encourage tourists, beaches will also offer free loungers, sun beds and tables when they open again for business.
Bulgaria has managed to keep coronavirus cases relatively low - the country has reported just 1,704 infections, and 50 deaths.