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Bulgarian Property market: Explaining the Mixed reviews

Wednesday, Sep 24, 2008

There are still mixed reports about Bulgarian property in the media, namely prices dropping in some resorts. At the same time, respected real estate analysts such as Knight Frank and CB Richard Ellis put Bulgaria at the top of the property charts.
Newspapers rarely explain why prices may be dropping in some areas of Bulgaria, preferring to focus on what is happening now rather than why. Taking Bansko ski resort as an example, a resort that has been popular the most popular ski resort for Brits to purchase in.
With good ski facilities and just a three hour flight from the UK, it
is considered a good value alternative to establish Western resorts. Demand for Bansko apartments and property grew and many Brits and Irish invested in Bulgarian property.
However, when times tighten back in the home country, for many small time investors, they would rather chop the asset that has the most potential to do well investment wise in order to prop themselves up back home.
As a result, Bulgarian distress sales are put on the market, sometimes with up to 50% of their real value knocked off. There are not many but these Bulgarian distress properties do ‘upset' the balance of the local property market as buyers are naturally going to favour these Bulgarian properties as oppose to those priced normally. Journalists are then quick to tarnish all properties in the area with same brush.
The bottom line is the fundamentals in the Bulgarian property market are good. Once Bulgarian distress sales have percolated through the market in places such as Bansko, Sunny Beach, the fundamentals will reassert themselves.

Source: Skipropertybg.com