Newestate
« BACK
Major cities such as Sofia and Plovdiv continue to show signs of growth, whilst coastal towns and resorts endure the exact opposite.
31.05.2016

According to data from Bulgaria’s National Registry Agency for the first quarter of 2016, the outflow of Russian owners has outweighed the increasing strength of domestic buyers. Despite Bulgarians now being the single largest group of buyers for coastal property, the volumes are seemingly insufficient to buck the downward price trend.

 

'volume of property transaction reduced by 20%'


Agency data shows that Varna saw a 1% decrease in the volume of property transactions year on year, but a 15% growth in mortgages. With mortgages only being available to Bulgarian buyers, this further supports other evidence that Bulgarians are going someway to filling the void left by international owners who continue to exit the market, but not quite filling it completely.

 

 

In the municipality of Bourgas the trend of domestic demand is stronger; 13% more transactions and 31% more mortgages, which can be considered reflective of both the city and the smaller southern resort towns in the province, areas typically preferred by Bulgarian holiday home owners.

 

'In Sofia alone there were 5,149 property transactions'

 

Surely this change in demand should help increase prices? Sadly not, these sales are only happening because the values are rock bottom and the risk to supporting banks and the buyers alike is at an all-time fiscal low. Furthermore, most such transactions are purchased by families to use themselves, often at the price of and instead of a new family car, rather than being speculative international investments dependant on capital growth and rental income.

 

'prices continue to slip by 10-15%'

 

In the Nessebar and Pomorie the story is different with the total volume of property transaction reduced by 20% by comparison to the same period in 2015. Unlike other areas there is no change in mortgages in this region, suggesting no new upward trend or greater and more sustainable domestic interest. This area of the market remains reliant on international demand and sadly that is only dwindling.

Overall, for owners in St Vlas, Ravda, Nessebar, Sunny Beach and Pomorie, the news is negative as prices continue to slip by 10-15% less than Q2 2015 and the volume of overall sales is a fifth less according to government statistics.

 

In Sofia alone there were 5,149 property transactions (including commercial, inter-family and inheritance) in Q1 2016, which is almost exactly the same as last year, however the volume of mortgages equalled half the total transactions, an increase of 19%, which again shows substantial gains in borrowing, market confidence and availability of lending. Almost all transactions are domestic, Q2 prices show steady growth and further support the expectation that 2016 will see 5% price rises across the capital.

Comments
Add comment
View selection  (0)
News
Gorian Varbanov
Author
Gorian Varbanov
About the author
Irina Dalgopiatova
Author
Irina Dalgopiatova
Irina is one of the editors of the website. She is always looking for good stories and relevant information. Irina has a degree in literature and has been involved in Bulgarian properties for more than 3 years.
About the author
Valuation request
What is your property worth?
Name
Telephone
Email
Property location
More info