Russian buyers propping up sagging Bulgarian property market
Real estate prices in parts of Bulgaria are still falling but there is some hope that Russian buyers are starting to come back to buy property in the once popular Black Sea coastal locations.
The latest analysis from Colliers International real estate agency indicates that property prices in certain Sofia boroughs, including Lozenets, Ivan Vazov and Iztok, have fallen in value by 3% since the start of the year, a 17% year on year fall.
In other parts though, prices are falling more, most notably in Manastirski Livadi, Vitosha, Buxton, Krustova Vada, and Gotse Delchev with a 5 to 6% fall this year and a 19% drop year on year.
New construction in Sofia in the first quarter is half what it was in 2009. No new large projects have been launched but old projects that were temporarily frozen due to lack of funding, have received fresh financing and building work has resumed.
Apartments with up to two rooms, ranging from €40 000 to €90 000, depending on location, are most in demand, with potential buyers searching for quality property for under €1,000 euro a square meter, according to the latest Colliers report.
Tatyana Emilova, manager at Colliers International Bulgaria, said the main factors defining the current environment were the ‘affluent choice of supply’ along with ‘alluring price tags’.
Overall, Colliers believes prices are beginning to stabilise but not everyone agrees. Some real estate experts are predicting falls of up to 20% in 2010.
The Russians though are starting to buy properties again in Bulgaria, most notably along the Black Sea coast, according to a report on Bulgarian television channel bTV.
According to Yuri Salovyov, Russian general secretary to the Russian embassy in Varna, more than 300,000 Russians regularly spend their holidays in the country and they are the most likely to buy a property.
Russians generally tend to choose property along large resorts on the coast, or the Bulgarian mountains, but they also settle occasionally for a quiet, rural way of life in small villages, the report said.
‘The great demand for real estate, which initially came from the UK and other English speaking countries, is being steadily replaced by Russian speakers,’ said municipal mayor Avren Todorov.
‘Many Russians are seeking to buy single family homes facing the seafront or flats in the cities, as many of them have decided to outsource their business to Bulgaria and move here permanently,’ said real estate agent Stefan Atanassov.