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Bulgaria Property - Sofia and Varna

The Bulgaria property market has received mixed reviews in the media as to whether buyers should look to invest or not. Much of this has occurred due to the frenzied property buying over the last five years with the belief that the market could do nothing but grow. Bulgarian off plan apartments were eagerly bought at whatever price and in whichever location. One could say it has been a case of excessive investment leading to oversupply and no exit strategies. Depending upon what and where they bought, some purchasers have done better than others.


Amidst all the concerns, the Bulgarian property markets of Sofia and Varna stand out. Partly because they are the two main cities of Bulgaria but also, and more importantly, because the underlying basics of good property investment remain.

Varna

The most upmarket and western-style city in Bulgaria and on the Black Sea coast. In many ways, Varna has better conditions for business than Sofia, according to data by Collers International. Their report cites many reasons why international businesses are locating themselves in the city. This includes lower business costs, flight connections, communication links, millions of visitors and a great lifestyle option.

Furthermore Varna Business park is the only complex of its type amongst any of the towns on the Bulgarian Black Sea coast. The companies based here operate across a broad spectrum of industries, including pharmaceuticals.

Apart from foreign investments, the population is some half a million, most of which live in the city and the shopping mall is one of the largest in the country, with more to come. Critical areas of business for this area are tourism, cargo traffic in the port and international road communications.

There are nearby golf courses - BlackSeaRama which is now open and Lighthouse and Thracian Cliffs. The coast attracts an upmarket sailing crowd, particularly the new marine at Balchik where an international yachting regatta was recently held.

Sofia

The city is at last showing signs of properly emerging as a fundamentlly sound property destination. It is one of the few capitals in the world where you can live in the heart of the city yet ski within 15 minutes of your base.

There is already a large population in Sofia and this is increasing with consequent rental demand. The capital is naturally receiving the main part of foreign direct investment. Most business is focused here with large international names including Hewlett Packard. This has of course brought with it many jobs and many Bulgarians are moving to Sofia.

Overall, the city is regenerating itself, especially in the southerly direction, including the suburbs south of the capital and close to Vitosha mountain, where most of the affluent Bulgarian elect to buy property. The main downtown centre is a mix of very run-down and brand new. The areas which are wisest for property investment are those with infrastructure, particularly quick access by road, underground or bus into the heart of the City. Construction, infrastructure and regeneration are continually ongoing.

In summary

For the property buyer and investor, Sofia and Varna are at the heart of foreign investment coming in to Bulgaria. Both are expanding their population and are benefiting from the rehabilitation of their cities, making attractive reasons for property investing:

- better value for money than other countries, even with the weak pound
- currency pegged to the euro
- property prices are now at market value
- continued influx of EU money
- have maintained sensible bank lending over past years
- 10% flat rate tax, one of the lowest in the EU
- international businesses with jobs
- high and increasing population means demand for rental accommodation
- benefitting from the improvements in infrastructure