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Bulgaria Property Prices - What's Next



Prices of apartments in Rousse have shot up with Romanians snapping them up but this has slowed right down recently. Apartments in Plovdiv, in the last three months, have shown an increase of 11%. Top end properties in the best areas are much in demand in all the cities. Sofia has tailed off a little, showing an increase in the same period of 6.8%. Rental yields are quite good but not excellent, ranging from 5 to 7%.

Large plan developments have been scaled down which is beneficial in those areas where over-development has occurred. Many of these will not suddenly halt but may be altered to more European style developments with less build per sq.m.

Lower price properties (those in the 45000 to 90000) euro range will probably see price decreases, as this is the market range in which so many UK property purchasers were most active. Mid range property, which accounts for over half of all property transactions, is faring much better and agents believe these properties will increase by between 5 and 10%. Top end property, which only accounts for a small segment of the market (around 4%), is also seen to provide favourable profits.

Compared with the UK, this is all good news for Bulgaria. Figures announced 30th October by the Nationwide in the UK, show that property prices have fallen by 15% in the last year. They are the first big lender to produce a report on the current UK market this month. Nationwide also says that the number of transactions is at its lowest level since 1974 and that house prices have dropped every month for twelve months, with houses taking 60% longer to sell than a year ago.

Buyers of Bulgarian property are also taking a longer time to decide upon their purchase as there is more competition with new developments but nothing like the lengthy period in the UK. Whilst the credit crunch has not dampened demand for property, investors and buyers have realised that Bulgaria has more to it than the coast and ski resorts. Some have shifted their attention to the countryside, moving to areas where prices are lower or better value for money.

Bulgarian property which fares best has:
- quality
- location
- infrastructure
- year round opportunities

The Bulgarian property market is beginning to cool but it still offers potential. Findings from the Oxford Business Group reported that whilst the days of 30% year on year increase are over, yields have not gone below 10%.

Look long term, select the best property in the best location, negotiate - and you'll still make a profit.