Bulgarian Property :: Real Estate in Bulgaria Blog

The European Commission has announced that Romania and Bulgaria will be admitted to the European Union in January 2007, but under some conditions. Commission President Jose Manuel
Barroso said both countries made many progresses to join the union.

Barroso: ‘I would like to congratulate the peoples and authorities of Bulgaria and Romania for all their efforts to meet the conditions for joining [the EU]’ Jose Manuel Barroso, the President of the European Commission said today 26 September 2006 in the plenary of the European Parliament’.

Source: The Romanian Business Newsletter

A ‘stark reversal of fortunes’ in the Bulgarian property market has been logged by property investment specialist Assetz. But France has ‘a strong and stable housing market’, it said.

’The eastern European country's market has not fulfilled its early promise as total returns have plummeted from 104 per cent to 44 per cent due to increased rental competition. Meanwhile, France rose to the top of Assetz's table, which looked at the percentage return on cash invested as a sum of net rental income and capital growth’.

In Bulgaria house prices went up by 1.6 per cent in the second quarter, putting the annual rate of house price inflation at 17.8 per cent, down from 36 per cent. In the popular Bansko ski resort prices have actually fell by 2.1 per cent, Assetz claimed.

The ‘mushrooming supply of properties’ is blamed for the slowdown. There is also fierce competition for rentals as the demand for letting has not matched the furious growth in home construction, said the firm.

’Bulgaria is facing a period of readjustment after a huge initial foreign investment’, reported Assetz managing director Stuart Law. ‘While longer term investors are still set to benefit over the next five to 10 years, as low cost property continues to attract holiday home buyers, there are no longer instant returns to be made in the short term.

‘France, meanwhile, is continuing to perform consistently well. The majority of investors want to make personal use of their property, either as a holiday home or somewhere to retire to, and they are opting for the quality of France as a sophisticated destination over emerging markets such as Croatia and Turkey’.

Bulgaria is attracting multiple property purchasers. One in every 12 purchases in the three months to July 2006 was for more than one apartment, Bulgarian Properties has reported. This is double the number in the first quarter.

‘The new trend for buyers is to look for a combination of a one bedroom apartment and a studio, rather than the pricier two bedroom apartments’, said the firm.

Meanwhile local reports have suggested an Italian businessman is planning to buy a village where only two people currently live to create a resort development. Paolo Bartali says he plans to restore abandoned traditional houses.

Source: Fly2Let

The interest in the purchase of three-bedroom apartments in Bulgaria was decreasing, property market analysis for the past several months showed.

Two main reasons led to the trend, 24 Chassa newspaper reported. Prices of such apartments remained high and at the same time market supply has not increased.

In the end of past year the interest in the purchase of three-bedroom apartments went up. Property agents said that Bulgarians were still lacking the income needed for the maintenance of larger apartments, though.

Agents said that most people looked for two-bedroom apartments. Interest in the purchase of three-bedroom apartments in the bigger Sofia districts decreased on the average between six and 15 per cent, 24 Chassa reported.

Demand in the central part of Sofia decreased most. The average price of such property there was 921 euro a sq m and more than 1400 properties were currently offered for sale.

In larger Bulgarian cities interest in the purchase of three-bedroom apartments remained almost unchanged. Agents said that the property market there was less developed and the number of people having the ability ti buy larger property was limited.

Source: Sofia Echo

The majority of demand for Bulgarian property currently originates from investors in overseas property from the UK and Ireland. This was reported in property website Homesgofast.com that cited a market overview by Colliers International.

The survey found that the interest in Bulgarian property from these investors has supported significant developments in recent years, both in mountain and coastal resort areas.

The town of Bansko is the most popular area for homes in mountain regions, as it accounts for 64 per cent of the holiday homes in these areas.

In June this year, supply of homes in mountainous areas amounted to over 12,000 units, an increase of 152 per cent in comparison to June 2005.

For coastal resorts, St Vlas was found to be the area most in demand, while Sunny Beach and Sozopol, all of which are on the country's Black Sea coast, were also popular.

Collectively, Bansko and St Vlas had 70 per cent rates of absorption for holiday home developments as of June 2006. The overall rate of absorption for Bulgarian property and holiday home developments was estimated at 60 per cent in mountain resorts and 56 per cent on the coast.

Sales prices of holiday homes in Bulgaria were found to be fairly stable in the Colliers International report, despite the fact that increasing supply was in excess of demand.

Source: Sofia News Agency