Independent
Property Consultancy
Bulgaria

Property prices

One of the largest attractions to property investors in Bulgaria is the very low property prices Bulgaria can offer.

Property prices in some locations here have been rising by more than 30% per annum – one of the highest rates in the world. In 2006, property prices in Bulgaria range from around £10,000 to £175,000 depending on property type and location, while you can still purchase a comfortable, well renovated property in a good area for approximately £50,000.

Market trends

In order to take maximum advantage of the Bulgarian market, market trends between each region of Bulgaria need to be understood, eg. supply far outweighs demand in the capital city of Sofia. Capital appreciation here in 2004 was just 5.9%. If you compare this with the town of Silistra on the banks of the River Danube which had capital growth of 36%, and the town of Vratsa with figures of 30%, Sofia offers a less profitable option. It is true that these figures reflect the comparatively low property prices in these towns originally, but supply and demand in these areas are also better balanced. Although these figures are impressive, investors with a buy-to-rent strategy should research their area very thoroughly before purchasing here in order to gain a realistic view on projected returns.

Now that Bulgaria is establishing itself on the foreign property market, it is shifting construction emphasis towards higher quality, exclusive developments. Only projects of the highest quality in terms of design, specification, construction and location are being considered. Permission for construction will be granted only if the developer can highlight a minimal effect to the environment and, indeed, protection of areas of natural beauty is paramount while protection orders have already been placed on National Parks.

Property Investment forecast

Despite the excellent growth figures experienced over the past decade, Bulgaria continues to be a comparatively very low priced property destination. Other nations in Eastern Europe seen as competitors are becoming more and more expensive which ensures that Bulgaria’s competitive advantage remains intact, despite rises in property value between 2003/4.

As a conservative estimate, prices in Bulgaria shall continue to increase at around 12 percent per annum until accession into the EU toward the end of 2007. There shall then follow an additional sharp rise in property value followed by the leveling out of the market by approximately the year 2009.