Fri, 14 Sep 07
The Bulgarian property market has been massively over-hyped in the last 3 years, according to Property Secrets...
This has been primarily due to the low prices and large commission agents were able to make and reinvest into their sales and marketing exercises. Unwary and ill-informed foreign investors brought property on the beach and in the ski resorts in their droves.
These purely foreign buyer driven markets have suffered from very poor rental and resale markets, and thus have delivered very poor returns for their typically British and Irish owners.
The negative press caused by the over-hyped holiday sector is quite a shame as Bulgaria does offer investor good long term investment opportunities in its key cities.
The property market in Sofia grew quickly in 2005 in the lead up to EU entry but in 2006 has shown less impressive growths rates due to oversupply and local demand not being sufficient deep to support a rapidly growing property market.
2007 has seen property prices start to pick up rapidly (officially prices grew 14.9% in Q1 07 in Sofia) and locals are starting to buy homes in ever increasing numbers as they see increased stability in the job market and they now have better access to cheap credit.
Demand is on the increase yet supply of new build property is very low at only around 3,000 units per year (compared with 14,000 in Warsaw and 800,000 in Spain last year).
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