21.11.2017 Bulgarian ski resorts - leaders in sales growth in Q3 of 2017
Polina Stoykova MRICS, Managing Director & Head of Research
We hope this information will be useful, especially now at the start of the winter season, and we are ready to help you further with advice and assistance to find and purchase the best property for your needs!
2017 has set a new beginning for the ski resorts properties in Bulgaria.
Increased activity, including the summer months, increasing volumes of sales, stabilized prices and constantly increasing interest by Bulgarian buyers - these are the main trends for the year that is soon to come to its end.
The main reasons for the increasing attractiveness of the properties in the ski resorts are the attractive prices on one hand, which are the best in Europe, and on the other hand - the improving infrastructure, the easy and fast access from the big cities, the accumulated experience in the management and maintenance of the complexes and above all – the ski resorts in Bulgaria have turned into all-year-round resorts!
This allows for a more complete use of the properties, prolongs the season and leads to the possibility of generating rental profit, albeit small, which is an additional incentive to buy.
Bansko is the leader in property sales growth in Q3 for the whole country. Data from the Registry Agency shows that transactions in the region grew by almost 30% in the period July-September.
There is also an increase in the sales volumes in the other two big ski resorts - 18% in Pamporovo and 5% in Borovets.
In all the three big ski resorts sales volumes have increased in 2017, with the strongest growth in the 3rd quarter of the year, which includes the summer months. This shows that the ski resort property market in Bulgaria is already active all-year-round, and during the summer months there is a particularly high demand for property to buy.
Despite the increased activity, we still cannot talk about rising property prices in the ski resorts. In all three resorts, prices have remained stable in the recent years. However, there is a segmentation process for differentiating the property prices depending on the particular characteristics of the properties, the complexes, and their location.
The average price of the sold apartments in Bansko in Q3 is 325 EUR/sq.m. compared to 320 EUR/sq.m. a year earlier. The average price for the nine months is 352 EUR/sq.m. compared to 366 EUR/sq.m. in 2016.
Deals in Bansko and the region are concluded at levels between 200 and 500 EUR/sq.m. depending on the exact location of the property and the quality and the facilities of the complex. The average total purchase price is 25,000 Euro compared to 24,700 Euro last year.
Borovets continues to hold an average price of around 600 EUR/sq.m. - 575 EUR/sq.m. is the measured value for the 3rd quarter and equally for the first nine months as prices tend to rise slightly as the supply in Borovets is already extremely limited and the attractive properties are quickly sold out.
In Pamporovo the average price for the third quarter is 340 EUR/sq.m. - no change compared to previous periods.
Currently, property purchases in the ski resorts are largely driven by local buyers. Almost 100% of the buyers in Borovets and Pamporovo are Bulgarians. These are people who live in Sofia and the other big cities, and we notice a growing interest from Bulgarians living abroad as well. The purchases are made for own use and rental in the rest of the time.
Bansko is the biggest property market and has the most international buyers' profile - the share of Bulgarian buyers is only 40% and the rest are foreigners coming from different countries in Europe and virtually from around the world.
An interesting fact is that there are buyers looking to invest money in a property in Sofia or another big city, but seeing the rising prices in the cities and the big budgets that are needed for purchase, they choose to buy property in one of the ski or spa resorts, where prices are much more affordable and very attractive.
Along with the purchase and sale of properties, Bansko is developing a market for seasonal or long-term rental. The demand comes mainly from foreigners, mainly freelancers, who can work from different parts of the world. They choose Bulgaria and Bansko in particular because of the favorable rental prices, the low cost of living, low taxes and high-speed internet.
We expect 2017 to finish with about 15% growth in the ski resorts property sales. This growth is expected to continue next year.
This will result in a gradual absorption of property stocks in the top complexes. We can expect a more pronounced difference in the property prices in different holiday complexes with a tendency for a slight increase in prices in the high-end complexes.
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