In the fall of 2008, prices for real estate in Bulgaria has reached its peak. Then a one-bedroom apartment in a panel house (1980) with a separate kitchen in a nice residential area of Burgas cost 60,000 euros, and against the background of the global financial crisis, already at that moment many began to wonder what would happen next.
Since January 2009, the fall in prices has become a universal phenomenon for all types of real estate. In 2010, this trend continued, and only by the end of the year, the secondary market, apparently, approached the threshold of maximum decline. Then, when a certain price level was reached, some categories of real estate began to sell very quickly, however, the number of transactions remained small.
Current state of the market
At the beginning of 2011, prices stabilized in the average price range. Moreover, there are offers on the secondary market, put up at higher prices than last year. This is the result of the revival of demand in late 2010 and early 2011, as well as a consequence of a decrease in the number of offers from property owners who want to sell it urgently.
The greatest interest from buyers in this situation is enjoyed by resort apartments in the middle price range in high-quality buildings with a good location. Offers in a lower price range also arouse interest, which is converted into purchases, but in a smaller volume, whereas for "luxury" complexes, where the price has decreased by 30-50% relative to peak values, interest, although high, does not lead to a large number of real transactions. Real estate in big cities, which has not experienced such large fluctuations in price, attracts local residents, but is poorly suited for foreign buyers.
In general, the situation in the secondary market is almost unchanged, the volume of supply is growing smoothly, and transactions are carried out only at certain price points.
At the same time, some of the developers have become more active, putting a number of new projects on the market in the hope of selling them at an increasing price. However, some time later, after the best of the apartments were sold, prices in these projects stabilized again at a level slightly above the crisis period.
Other developers who had problems with financing during the crisis, but did not accumulate large debts, managed to find co-investors and are gradually completing long-started projects, albeit with a delay relative to the schedule.
Demand characteristics
Demand for resort real estate in general remains low. For domestic demand, the key fact is the lack of own funds among Bulgarian residents and their distrust of credit institutions. The demand from Western Europeans is small and, as before, has an exclusively investment character. Against this background, Russians remain the main buyers of resort real estate, however, with a generally high enough interest on their part, only about 30% of requests actually turn into transactions.
The established level of real estate prices in Bulgarian resorts depends on several factors: climate and geography, the volume of offers in a particular place, as well as their quality. It also matters who is primarily the seller. For example, in the famous ski resort of Bansko, the main buyers before the crisis were Western Europeans. Now they, disappointed with the financial result of managing their real estate, massively put it up for sale, so that the price of transactions in Bansko fell to 300 euros per sq.m. However, there are other price formation factors at other resorts.
Current real estate prices
Here are the current prices of transactions on the secondary market of Bulgarian resorts in the spring of 2011.
| Average level (euro per sq.m.) | High level (euro per sq.m) | |
| Sozopol | 700-900 | Up to 1300 |
| Varna | 700-1000 | Up to 1200 |
| Sveti Vlas | 500-800 | Up to 1200 |
| Burgas | 600-800 | Up to 1000 |
| Sunny Beach | 400-600 | Up to 1000 |
| Primorsko | 500-1000 | - |
| Pomorie | 600-800 | Up to 1000 (rare) |
| Sarafovo | 550-900 | - |
The most liquid offers at the moment are in well-equipped resort or urban areas with developed infrastructure near recreation areas and beaches. Studios are in demand at a price of up to 25,000 euros, one-bedroom apartments – up to 40,000, two-bedroom apartments - up to 60,000 euros, in the luxury segment - 100,000. The demand for detached is within 50 000 – 150 000 euro depending on the location and quality of construction.
Current trends in the Bulgarian resort real estate market include the continued demand from Russians, as well as the expected investment demand from Bulgarian companies and individuals with free financial resources. The further influence of buyers from Western Europe on the market remains questionable, whereas in the south-western regions of the country, demand from Greek residents has already become an important market factor.
The review was prepared specifically for the portal HomesOverseas.ru by the company
