Mihail Chobanov for BNR: Real estate market is booming in midst of Covid-19 epidemic

The coronavirus has made people want to own real estate, with the demand being highest for houses far from big cities.

Over the past year, the real estate industry has registered a rise in the number of real estate transactions as well as in property prices. People tend to prefer to buy rather than rent houses or apartments close to nature where they can work remotely during the pandemic.

“We are in for an exodus of people for as long as possible, as far as possible from big cities – a tendency that is going to deepen even if we annihilate all strains of the coronavirus,” says Mihail Chobanov, managing director of a leading real estate company in Bulgaria.

He says there is a significant rise in the demand for vacation homes by Bulgarians living abroad. With the “deposit” fee some banks are charging on larger sums an even more appreciable upturn in the sector is to be expected. The reason is that after 7 July many of the clients, instead of being charged 0.75% default interest on the sums they keep in banks as fixed-term deposits, will choose to invest their money in real estate. On the whole the demand for remote work is one of the motors of the real estate market right now.

“There definitely is an increase in absolutely all segments with the exception of the seaside and mountain resorts in the country, where there is still a sufficient amount of available high-quality property on the so-called secondary market. With Brexit and the corona restrictions, people from Britain who once bought expensive property are now looking to sell it at a lower price. The same is true of the Russians who, owing to the devaluation of the ruble and the travel difficulties, are now selling the houses and apartments they previously bought. That is the only segment in which no rise in property prices has been registered,” Mihail Chobanov says.

The prices of village houses, on the other hand, have gone up by 3-5% since the beginning of the year. What is more, with the significant rise in the prices of absolutely all building materials on world stock markets, new construction prices are expected to go up by 10%-13% in the coming months.

And one more interesting tendency – more and more impatient buyers, and not just in Bulgaria but from all parts of the world, tend to opt for remote property surveys using Skype, Viber or some other online platform to make their decision before concluding the transaction. Mihail Chobanov points to one more deepening trend in the real estate sector in this country:

“More and more often in recent months clients from Canada, the US, from New Zealand etc., have been approaching me and all colleagues from the sector, these clients are Bulgarians who are out to survey, remotely, property they want to buy as an investment. The idea is to use this property during their summer holidays in Bulgaria with their families as soon as travel resumes. We now have a more than 20% increase in this kind of interest,” Mihail Chobanov says.

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