04.09.2007 Investment potential in a maturing market
An important indicator of the maturing property market is that there is now a noticeable shift in buying patterns. Many of today’s buyers are people taking early retirement or, increasingly, families moving to Bulgaria to secure their place on the property ladder, together with those seeking second homes as their holiday base and as a longer term investment for the future. But these buyers are now being joined by a growing wave of newly affluent Bulgarians from Sofia and other cities around the country looking for weekend or holiday homes in the resorts. In short, the consistently rising demand is maintaining the impetus of the property market - and this demand is being driven by four key factors: the low entry prices, the medium to long-term investment potential, rising local income levels and, underpinning all of this, the continuing development of infrastructure and world-class tourist facilities.
A look at the facts and figures consolidates this market analysis. Capital growth has now slowed from the headline-grabbing 35 to 40% levels of recent years and the latest investment forecasts show increases of a much more realistic 18 to 20% for this year. While buyers are no longer seeing the same sort of easy returns from “flipping” their investment through quick purchase and re-sale, the National Statistics authority says that in both the first and second quarters of 2007, the average price of an apartment in Bulgaria rose by 5.4%, with a further increase of around 8 to 10% suggested for the rest of the year. In fact, Bulgaria’s property prices are now following the pattern of what occurred in other countries following EU accession. But, as a bench-mark for comparative purposes, they are currently up to 30 to 40% lower than in Slovakia, Poland or the Czech Republic.
Probably the most important factor to consider, though, in terms of buying decisions and investment planning, is the availability of capital from mortgages. Under current regulations it is not possible to obtain a mortgage on a non-finished (or off-plan) property until the development has reached an advanced stage of construction - usually referred to as shell stage. And, while this rules out the possibility of a mortgage for many off-plan apartments, it does open up an entire new sphere for investment in both new-build and older properties. Most of the Bulgarian Banks now offer mortgage services and this will continue to develop as more and more financial institutions open up here now that Bulgaria is a member of the EU. For more details, check our website.
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:
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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.