Tue09252018

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Market Trend

It's been quite a rough time recently for real estate agents and developers in Bulgaria. Those who have depended so heavily on the UK market have been caught by the slump in the sterling to euro rate which has meant that some potential property buyers from Britain have put their purchase on hold. There has also been bad press towards some developers who have over-developed in certain areas without thinking or caring about the impact of their development or whether new owners would be able to find tenants.

 

The over-development has resulted in some properties not selling and in other cases, owners being unable to find tenants, or rather a tenant whose rent would be sufficient to cover the mortgage costs. Some of these owners are now in a position where they are forced to sell - even at a loss. There was a case of one owner who had to reduce their apartment on the coast from 125,000 euros to 85,000 euros. There is a feeling of "doom and gloom" amongst many Brits who bought with a very large mortgage and now, being unable to get tenants to cover the cost, are selling.

However, it's all far from being just bad news in the Bulgarian property market. Properties which are in sought after locations and are of high quality build are holding their value. These types of properties are still selling well and also are attractive to good tenants who will pay a decent rent.

It's all come down to location and quality.


There is also other encouraging news. The NSI reported that apartment prices in the third quarter alone of this year, rose on average by 3% across the country. Whilst global property growth slowed, Knight Frank reported that values in Bulgaria had increased by 32.3% in the last year. Agricultural land prices rose by 35 to 40% this year as reported by the Bulgarian Association of Farmland Owners. A piece in The Sunday Mail said that they consider Bulgaria a "hot ex-soviet state which has top beaches and cool culture"

Naturally, this data and the reports don't suggest a new boom in Bulgaria and thank goodness for that. However, they do support the view that Bulgarian property prices are stable and not likely to take a major drop such as the drastic falls in the USA and UK. As the storm continues to rage elsewhere, the property market in Bulgaria is nice and calm.