Investment Property in Bulgaria

In 2003 the Real Estate National Association assessed the Bulgarian property market for market wide price increases.  They reported that there was a 26% average rise in property prices across the country in 2003 and forecast only fractionally lower rates of increase for 2004.

This makes the real estate market in Bulgaria one of the strongest and most profitable property investment markets currently.

Incredibly, Bulgaria is now the third most popular holiday destination after Spain and France for British holidaymakers looking for beach holidays and those interested in finding first class under inflated ski resorts. 

Summer tourists are attracted to the beautiful white beaches along the Black Sea coast and Bulgaria’s long hot summers.  And winter tourists are drawn to Bulgaria’s stunning mountains and fast developing winter spots program.  More and more, tourists and foreign investors are being attracted to the incredible offers and bargains in the real estate market in Bulgaria as well.

Those who feel they have missed out on the real estate booms in Italy, Spain or Florida for example, and those who cannot afford the over-inflated Spanish and French markets are overwhelmed with the opportunities for property investment in Bulgaria and are also attracted by the fact that overall legal costs and property running costs in Bulgaria are far lower than those in the rest of Europe - for example the Bulgarian equivalent to council taxes or rates are only £25 to £30 per year!

Foreign investors are not put off by the fact that they are not legally permitted to own land in their own name - they simply establish a Bulgarian company and purchase through that.  As the legal owner of the Bulgarian company which owns the property the foreign purchaser becomes the legal owner of the property!  It is simply a legal way around the current law on property ownership rights.  The laws are set to change as Bulgaria comes in line with EU policy ahead of its expected ascension to EU membership in 2007.

It is even possible to borrow money from some international lenders to fund property purchase in Bulgaria now.  One such lender is the Greek bank, Piraeus Bank.

And if you decide to go ahead and purchase a property in Bulgaria, the following resource should prove invaluable: -

Buying a Property in Bulgaria

Jonathan White

This practical and authentic guide to buying and managing property in Bulgaria is due for publication on April 29th 2005.

Click here to order a copy directly from Amazon!

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So with all these positive factors fuelling the real estate market in the country, let’s take a look at the types of property available for those looking to invest, relocate or holiday in Bulgaria.

Starting with Sofia - which is not only the lively, sophisticated capital city of Bulgaria, it is in fact the largest city in Bulgaria and home to around 1.4 million people.  It is also home to all the major embassies and big businesses in the country and has a thriving property market.  As a result it deserves individual consideration when it comes to examining the property investment market across the country.

The property market in Sofia is fast moving and strong.  It is buoyed up by the rental market which enjoys high demand coupled with high prices!  The potential returns on investment if you were to purchase in the city and then let your asset out are considerable.  Of course there is a downside to all this; property prices in Sofia are the highest in Bulgaria and are increasing all the time.

In fact those wise enough to have invested in apartments in the Southern Park area of Sofia were lucky enough to see their investment enjoy a 30% increase in value before the properties were actually finished!

From Sofia to Varna - Sofia is the capital city of Bulgaria and Varna is the sea capital city of Bulgaria.  And just like Sofia, Varna is enjoying a population boom as more businesses establish themselves there.

The city is located on the Bulgarian Black Sea coast and is a popular beach holiday resort.  It has excellent tourist infrastructure incorporating great beaches, well maintained landmarks and monuments, a fantastic social, bar and restaurant scene and a lively night life.

The demand for short term holiday rental accommodation in the city is growing and as more businesses establish head quarters in the city there is also a demand for short-term business rental property as well, meaning that there is plenty to consider for the property investor.

Beach Properties & Black Sea Coastal Properties - Bulgaria is enjoying a tourist boom with visitor numbers increasing year on year.  Among the most popular areas for visitors are the international beach complexes of Sunny Beach and Sveti Vlas which also have well developed property investment markets.

European, Russian and Bulgarian tourists flock to the area every summer pushing demand for holiday rental accommodation right up.  Building companies have seized on the private land available in these areas and built to satisfy the demands for holiday apartments - either for let or purchase.

The beautiful old town of Nessebar located just 3km from Sunny Beach is also enjoying a property boom.  Holiday apartments in this area are considered excellent investments as the summer rental market in the area is saturated in terms of demand.  Rental incomes during the busy summer months are good.

The Bulgarian Black Sea coast is the area that most tourists to the country visit - making demand for second homes and holiday rental accommodation right along the coast high and property prices along the Black Sea coast are increasing with demand.

The majority of those considering relocation to Bulgaria or investment in the country’s real estate market are snapping up homes in and around the most popular Black Sea resort of Sunny Beach, Nessebar, Golden Sands, Sozopol, Varna, Albena, and Bourgas.

Ski Resort Properties - Bulgaria has an already thriving ski tourist industry and the country is ploughing considerable investment into developing this side of its tourist industry.

The country already boasts the first class ski resorts of Borovets, Pamporovo and Bansko - with Borovets the most popular and most visited.  Property demand and prices in this resort have now rocketing!  The resort is a purpose built one and has been a favourite with British skiers for the last 20 or so years.  It is now enjoying world wide recognition which brings with it considerable demand for property.

The Bulgarian Government is aware that they can seriously boost their economy with the further development and establishment of first class ski resorts - and those interested in real estate investment know that a booming property market will go hand in hand with the increase in investment.

Rural Properties - Investors looking for the next boom area in Bulgaria should consider exploring some of the less well known and more rural areas of the country.

In fact so much of the country remains unknown and unexplored by both visitors to the country and potential property investors that the best bargains by far can be found in the pretty Bulgarian villages.

A lot of Bulgaria remains untouched by modern life and as a result properties in the more rural areas are often in considerable need of renovation.  But the real estate available is incredibly cheap and offers great ROI potential.  Chances are an investor will be able to cash buy a property of his choice.  And despite the fact that the more rural the area, the less likely it is to be developed and sophisticated, you are still likely to find tarmac roads, Post Offices and local shops, buses to the bigger towns, bars, restaurants and petrol stations.

And most villages are within reach of regional towns offering far more in the way of amenities - from internet cafes to cinemas, from train stations to hospitals and schools.

If you are a property investor looking for the next ‘big thing’, you may very well like to consider all that the Bulgarian real estate market has to offer.