Post from another forum
I am Bulgarian and I’m living in Sofia, but I’m not a property agent.
In 2002 I purchased 150 sq.m. apartment in one of the most expensive districts in Sofia “Lozenets†for 350 Euro per sq.m. The deal: the developer purchased the land for 100 Euro per sq.m., built 6 storey apartment house and sold it for 350 – 400 Euro per sq.m., making modest profits of 200-250 Euro per sq.m. Between 2002 and mid 2005 the apartment’s prices went up 2-3 fold, driven mainly by British investors. It was good time and I have sold a lot of off-road cars (I’m a car dealer and roads here are not quite good) to developers, builders, suppliers of building materials, real-estate agents, etc., but since the prices started to fall they do not look so optimistic as they were before. Meanwhile everyone who could afford it already bought (because Britons are coming) second, third, fourth or fifth apartment in Sofia, residence in Bansko or seaside, so now here is full with uninhabited blocks and borrowed loans.
Having in mind that, on the negative side:
-Bulgaria is very sparsely inhabited, lost 15% of its population in the last 15 years and this trend even accelerates, there are 3.6 million dwellings on 7 million population.
-average incomes are approx. 75 Euro per person per month and do not seem to improve anytime soon
-30000 apartments are in the pipeline (2006) in Sofia alone
-current account deficit (import is bigger than export) for 2005 was 14% and is worsening
-the whole economy became too much dependent on British property investors
-rents rates in Sofia now are between 1 and 3 Euro per sq.m. monthly, but it is very difficult to find tenants
-Cost price for building 5-8 floor house is approx. 170 Euro per sq.m. (without land)
-at seaside loss making hotels started to be transformed into apartment houses for British property investors
and on the positive side:
-Number of British property investors seem endless, furthermore they started to sell between themselves (they can not sell to Bulgarians of course), trying to raise the prices even higher
-Bulgaria will soon join EU, so hopefully property investors from another countries will be also interested in purchase
-Number of British tourists increased 100% from 10000 to 20000 in the last seasonIs the current prices decline temporary or not?
Originally posted by bardon:Post from another forum
Is the current prices decline temporary or not?
You are asking on an Australian Forum? I suspect you couldn’t find a market further from our experience [blush2]
Al lthe best,
Simon Macks
Residential and Commercial Finance Broker
***NODOC @ 7.15% to 70% LVR***
[email protected]
0425 228 985Comments may not be relevant to individual circumstances. If you intend making any investment, financial or taxation decision you should consult a professional adviser.
hi bardon
couple of reasons why not to invest.
1. security or lack of it for non secure loans the rate is around 25%
per annum and up front which you are not going to get.
2. why invest in bulgaria when I can invest with the same risk in fiji or western samoa and the return is better.
3.for british pound I would invest in the northern lebanon, french south wine area,or the south of spain, and get better returns the bulgaria.
4.british investors invest were the return is equal to risk and not sure if that takes in bulgaria I think that you would find more investing in eastern asia, the arab states and the greek island areas before bulgaria and why
because I’m british and go there at least once every 2 years so know a little bit about the country.
One thing you must do when pitching a sale is know your market and sorry you don’t.
the people investing in bulgaria is the eastern european /old ussr states and yes they are investing and yes the market is moving but to the extent that you are prodicting isn’t on my radar.here to help
If you want to get involved in some of the projects I’m involved in email to [email protected]Dont worry I have no intention of investing in Bulgaria it was a verbatim cut and paste from a UK forum to counter the previous post talking up Bulgaria.
I am investing overseas but it is an English speaking country that is based on the Westminster system. AT least when I talk to my realtor and PM my bulls***t detector functions as it only works in the English language I would be severally handicapped without it.
You must be logged in to reply to this topic. If you don't have an account, you can register here.
