Bulgarian property market may get huge boost from tax changes in Britain
The rule change, announced by Chancellor Gordon Brown in his pre-Budget Report and introduced on 27 December, allows property funds to be included in Individual Savings Accounts (ISAs), Personal Equity Plans (PEPs) and Child Trust Funds (CTFs) for the first time.
Some 82 bln pounds are currently invested in ISAs and PEPs, news agency Reuters quoted experts as saying Thursday. Independent financial advisers were recommending that between 5 and 15% of typical investors' total holdings, excluding their own property, should be in property, said Reuters.
The new legislation is an incentive to diversify savings portfolios with investment in funds developing retail, office, warehousing, industrial and other income-yielding properties.
The move will spike the interest of British funds in the Bulgarian property market for as long as they connect with the necessary incentives, said Roger Hornett from Development Capital Management. The company manages Black Sea Property Fund which is investing in Bulgaria. If Bulgaria's 2007 EU accession is rubber-stamped this spring, that would give a further impetus to incoming investment while making it less risky, he said.