Buy & Sell Bulgaria Insight Newsletter

Please be informed that if you have purchased properties in Bulgaria and due to changes in the Bulgarian Law on Local Taxes, all owners/companies registered in Bulgaria are obliged to submit tax declarations according to Article 14 of above law and to re-declare their properties by end of June, 2010.

Eurolink Financial Group offers you the service of organizing this on your behalf for EUR 100 per property, paid by June 29th, 2010.

Should you wish the procedure to be carried out by our financial specialists, please email us to confirm and arrange payment.

May 10th, Actualno.com

Construction companies building golf courses, shopping malls, hotels and Spa resorts will once again enjoy the privileges offered by the state, says SEGA quoted by CROSS.

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April 13, 2010, The Moscow Times

Bulgaria was the country of choice for Russians buying real estate abroad in the first quarter до 2010, beating out warmer climes like Spain and Italy because of low prices and aggressive marketing, DOKI said in a report.

It’s a title that Bulgaria has held for three years already. But while it used to be the destination of choice for middle-age Russians looking for vacation homes, Bulgaria is now turning into a heaven for retirees looking for a cheap place to live away from Russian winters.

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The British Court of Appeal (Civil Division) with its judgement in the Apostolides v Orams case (Case No: A2/2006/2114) on 19 January 2010 has created an unexpected new legal situation in the ongoing struggle in Cyprus between Greek-Cypriot owners of property who had been forced to flee in 1974 and whose land had been grabbed by the invading Turkish Army, and for the mostly foreign speculators who took control of those lands, building, at times, plush ‘holiday’ dwellings on them.

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Is the time right to invest?

Usually in any market, stock, bond, commodities, etc., the markets turn without very many people realizing it. By the time a change in the trend has been detected and accepted, the major opportunity to buy or sell has been missed. The majority of the investors will sit on the sideline because they are afraid that the time isn’t right yet. Meanwhile the smart-money minority is grabbing the opportunity.

The moral of the story is: don’t try to time the market. Look for investments that make sense and don’t worry about buying at the absolute low. An old saying on Wall Street says: Bulls win, bears win, hogs get slaughtered. Don’t be a hog.

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In 2008, Bulgaria had the lowest price level for goods and services of all 27 EU member states, according to latest Eurostat data.

The most expensive EU countries are Denmark with 141% of the EU average, followed by Ireland (127%), Luxembourg (116%), Sweden (114%), Belgium and France (both 111%).

Bulgaria’s consumer prices for goods and services were only 51% of the EU 27 average. Other cheapest EU states are Romania (62%), Lithuania (67%), and Poland (69%).

In the different categories of goods and services, Bulgaria’s price levels are lowest in the EU for food and non-alcoholic beverages in 2008 - 67% of the EU 27 average compared to the most highest level - 147% of the average in Denmark.

For cigarettes Romanians paid the least, while smokers in Ireland had to pay dearly.

Clothes are one of the goods, which prices did not vary so much during the period under review. However they were the cheapest in the UK and the most expensive clothes were the ones in Finland.

Again, in the UK electronics could be purchased at a profit, while in Malta they were the most expensive good.

In addition, Bulgaria’s prices for restaurants and hotels services were only 40% of the EU average, whereas the highest prices in the Union in this category, Denmark’s, are 151% of the EU average.

Topsport - The contract for F1 will be signed on Friday

By Svetla Dimitrova

The track will be constructed most probably near Varna because of its infrastructure.

The president of the Bulgarian Federation of Motor-cycling (BFM) Bogdan Nikolov announced, that Bulgaria would sign a contract to host the F1 Grand Prix with the promoter of the World Championship Bernie Ecclestone on Friday, July 10, 2009, the online edition of the newspaper Dnevnik announced.

The Chairman of the Organization Committee of Bulgaria’s Grand Prix Mr. Rumen Petkov, representatives of private investors and the Deputy Minister of Finance Kiril Ananiev, should meet with Ecclestone before Germany’s Grand Prix at Nürburgring, where the contract should be signed.

The meeting is under question because Ecclestone would not travel on Thursday, due to his recent problems caused by his extreme statements about Hitler, but most probably he would join the Grand Prix at Nürburgring later on. READ MORE »

How to buy a home during a crisis

Revolutions often take place in a time of crisis. Some significant changes took place in Bulgaria since the beginning of the crisis in the real estate sector. Developers and real estate agents affirm that now it is the buyer to dictate the rules on the market. But does he know it?

Demand for homes is a steady constant. It is to remain in Bulgaria with or without a crisis. Official statistics show that 96% of Bulgarians own the properties they live in. Hardly ever more than 2/3 of the population worldwide and in most developed countries, in particular, lives in their own homes. The big dilemma a buyer faces is: should I buy now? Housing prices have tripled since 2002. At present the average price has reached 680 euro/sq m, while it was just 160 euro/sq m seven years ago. Prices continuous uphill led to a construction boom in the big cities. So currently customers are faced with numerous options to choose from. In 2008 over 21,000 houses & flats have been completed, a number which is slightly more than twice the amount of properties built in 2004. A lot of developers are disposed to give discounts in order to get rid of the excess of units they have available. Along with opportunities, buyers and real estate market participants have encountered some challenges, as well. In the past three years buying a property was never related to tackling such a long list of questions. Shall I obtain a loan? Of what amount should it be? Should I take the risk of buying a larger property? What if I lose my job? What if banks don’t approve my income? Do deferred payment schemes really work? Are they safe enough? Is off-plan buying cheaper? (I still remember those ‘pyramids’). What if the developer goes bankrupt? Prices are falling now. What if tomorrow they fall even faster?…

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Interview by Veselina Sapundzhieva, 26^th May, 2009

Translation: Lili Gospodinova, PR of Eurolink Investment Group

Prof. Nikiforov giving a lecture at a conference held by Eurolink Investmenmt Group in 2008, The Eagle Has Landed

Prof. Architect Ivan Nikiforov is a Doctor of Architectural Science and the team leader of the group of specialists who prepared the General Town Plan (GTP) of Varna. He has a long professional experience gained from his engagement in developing many towns. A couple of days ago he was granted the prestigious award ‘Varna’ for his work on the GTP and his book ‘History of town development’.

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In what many see as a doomsday scenario for investors in northern Cyprus and justice for those forced to flee when the island was split some years ago, the European Court of Justice (ECJ) has handed out a ruling which will shake the very foundations of the Cypriot property market. A situation regarding land ownership has been ongoing for some time although very few people believed we would actually arrive at a definitive ruling in favour of those forced to flee in 1974 when Turkish forces invaded northern Cyprus.

Background to the ECJ ruling

When the island of Cyprus was effectively split in 1974 after Turkish forces invaded the north of the island there was literally a free for all regarding property and land ownership in the region. After the eventual introduction of a United Nations peacekeeping force across the boundary between north and south Cyprus we saw a significant property market start to develop. However, since 1974 there have been various attempts to reclaim land which was lost when Greek Cypriots were forced to abandon their properties and their lives in northern Cyprus.

Interestingly European Union law was suspended in 2004 when Northern Cyprus joined the EU bloc although yesterday’s ruling has effectively negated any potential protection offered by the earlier action. The ECJ has ruled that the suspension of European Union law does not stop other EU members from upholding judgements against northern Cyprus, which is only officially recognised as a country by Turkey.

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www.retirement-homes-bulgaria.com

During the last couple of months our offices have virtually been bombarded by telephone calls and e-mails requesting comprehensive information and advice for relocation to Bulgaria.

The people behind the telephone calls and the e-mails come from various walks of life and from all over Western Europe, and they all have one thing in common - their very serious concern for the recession, which rapidly is affecting everybody’s life. It is obvious that their concern is not unfounded and as things develop in most countries in Western and Central Europe, soon people will find it impossible to make ends meet. It is natural that a huge number of people will seek alternatives and go where their money can buy them good quality of life. It is also not strange at all that these people are turning to Bulgaria as the best and most affordable country to relocate to. Not only the cost of living in Bulgaria is ¼ of what it is in most EU countries, but Bulgaria is a peaceful, friendly and safe country to be in. It also has everything that any other EU country has to offer and a lot more that most EU countries cannot offer.

We feel that it is our obligation and our duty to help these people in any way we can, starting by offering them valid, accurate and professional advice as well as every service and assistance that they may need before and after the relocation.

The new website, www.retirement-homes-bulgaria.com, will display everything that has to do with retirement, relocation, the legislation and regulations, health care, insurance, residence permits, cost of living, shopping, buying and owning a property, banking, payment of bills, translations…everything that you may want to know about Bulgaria! So, look out for it…its coming soon!

By Alison Steed, Source – AXA report

As many as 500,000 Brits could be leaving our shores to become expats by the end of the year, reports Axa, one of the world’s biggest insurers. The study which was conducted between October and November 08, puts Bulgaria’s Black Sea costal city of Varna at first place and as their first choice.

It is difficult to use forecast figures as a barometer of intent to be fair, but there is no doubt that the trend for moving abroad is increasing.

In 2006, official figures from the Office of National Statistics showed that 400,000 people emigrated from the UK, and by the end of 2007, Axa had seen an 11.7 per cent rise in the number of inquiries for international private medical insurance, and a 28.6 per cent increase in inquiries from those looking to relocate elsewhere in Europe.

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Dear friends, investors and clients,

Normally this message would and should have started with my best wishes for the New Year, for happiness, health and prosperity for all of you, your families and the world in general!

Though this is my genuine and wholehearted wish, what is happening around us and what the forecasts are predicting, do not allow much of optimism and positive thinking.

What started as an economic crisis in some parts of the world is now turning into a long lasting nightmare, the end of which nobody seems to be able or willing to predict.

In the meantime those who are guilty for causing this drama, which under normal circumstances should have been made to pay the price, are sitting tight and waiting to harvest the loot of their crimes. Mainly in the form of state funding destined to help the economic recovery.

I wish I had some good news and optimistic predictions to tell you, but I am afraid what I have to say and how I see the future, would for most of you, be a bad dream come true!

You may all recall my past statements as to the reason why we chose the new residential sectors of the city of Varna (the shores of the sea-lake and the surrounding area) to be the epicenter of our investment concept. I was predicting then an economic situation which would have forced hundreds of thousands of western and northern European citizens to leave their countries of origin and look for cheaper and more suitable countries to relocate.

A recent study, prepared for the Insurance giant AXA predicts that before the end of 2009 over 500.000 Britons would leave the shores of the United Kingdom and settle in other EU countries, mainly Bulgaria, Greece and Cyprus!

Additional studies and reports, coming from highly reliable sources, predict the same exodus from other Western, Northern and Central European Union countries! You don’t have to be an economist genius to see what is coming! The present crisis and economic depression will not go away by decreasing interest rates and pumping politics into the sick economies. I am afraid that certain economies and mainly the British and American, are in for a very long recession the kind of which we haven’t seen before! Permanent recovery will only come about if and when the foundations on which the future world economy is built on, is based on real values and strictly managed financial markets.

In the meantime, younger and smaller economies, which based their development on more traditional and conservative principles (The newest EU members, Russia, China, India, some Far-Eastern countries, Brazil, Argentina etc) will greatly benefit from the crisis.

In the case of Bulgaria, for which naturally we are more interested, I strongly believe the time has come for the long awaited boom! Regardless how we look at it and in full awareness of the practical and other problems Bulgaria may have, its strategic position, its proximity to Europe and Russia, the low cost of living and housing, the openness of its society and the beauty of the country will play a decisive role in attracting both investment and investors.

Somebody may say… “But Bulgaria and more specifically the property market and the construction industry are already on their knees”! True, but somebody has to see why? It is not a secret that a very small part of the property market and of the construction industry, targeted the “residential home” market! On the contrary over 85% of the available units (completed or under construction), were designed and built as “holiday homes” and were never destined to meet the needs of people wishing to relocate and settle permanently in Bulgaria. In fact, very few companies and Eurolink Investment Group are the first among them, targeted the market which under the present circumstances will generate the future demand.

In our case and from the very beginning we said … “we are not interested for a hit and run situation! We want to catch the real market which has both volume and duration…we want and we are going after the clients who want to settle and live in Bulgaria”. All our planning (prime residential quarters – golf courses – medical center – multi-lingual schools – the marinas - etc) provides for pure residential homes and top quality living for real people with real needs. Our time has come!

I will once again make a prediction, which I am more than sure it will come true! The New Year 2009 will see a massive influx of British, Irish and Central European clients, looking for suitable housing and business properties to relocate to. The years to follow will see a steady increase of this trend, a fact that will force the Bulgarian authorities and the market forces to adapt accordingly.

Most of you were waiting for this moment to come! I am not sure if it is coming too early or too late for some of you, but what is sure is that this situation will create huge demand for prime building plots, houses, shops etc. The great majority of the land you have invested in answers fully to these specifications! As it is always the case, it is a matter of timing and correct marketing. I believe we have both!

Those of you who were skeptical and chose to stay away from investing, you still have time! Naturally you will not have the same returns as those who invested a few years back, but still with a balanced and well planned investment, you can beat the crisis and the diminishing value of your savings and your equity and make a good profit for the future.

For those of you considering retirement or you have friends and relatives who do so, choosing Bulgaria and Varna in particular not only will offer you a better life, it will also help you to recover the lost equity from the economic crisis back home!

As always, the Eurolink Team and me personally, are at your disposal for every help, assistance and advice you may need!

Bulgaria ranks first in the EU in the implementation of the Internal Market laws as it has incorporated all of them in its legislation.

The news was reported by euobserver.com, which announced that the European Commission commended the EU member states as a whole for approaching the goal of less than 1% of Internal Market laws left to be implemented.

Romania, which joined the EU together with Bulgaria on January 1, 2007, is ranked third with seven laws left to implement. Slovakia, Germany, and Latvia are second, fourth, and fifth respectively.

The Czech Republic and Portugal are doing worst under these criteria with 42 and 32 laws left to implement.

At the same time, Romania, Bulgaria, and Lithuania are the three EU states with the fewest infringement procedures, with France, Spain, and Italy having the greatest numbers of infringement cases.

From The Financial Times
By Ilian Vassilev

After a year and a half of European Union membership, Bulgaria is undergoing a reality check. While the country is enjoying strong economic growth, there is growing popular frustration over a wide gap with “old” Europe in standards of living and social protection.

Consumer protests against fuel prices have so far been muted in Bulgaria. But planned increases in the cost of basic utilities and public transport could spark discontent on a larger scale.

Yet the global credit squeeze has had only a moderate impact.

Economic growth, projected at 5 per cent for 2008, remains among the highest in the European Union. The stock market has been hardest hit - although the sharp fall in prices has encouraged Bulgaria’s largest companies to consider offerings on leading international stock exchanges.

Strong credit growth, at about 55 per cent last year, underlines the strength of Bulgaria’s recovery from the economic collapse of the 1990s. A modest decline in growth rates may even prove healthier and prevent overheating in certain sectors.

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In May 2008 compared with April 2008, industrial production fell by 1.9% in the euro area and by 1.4% in the European Union (EU). In April production grew by 1.0% and 0.3% respectively.

In May 2008 compared with May 2007, industrial production decreased by 0.6% in the euro area and by 0.5% in the EU.

These data is released by Eurostat, the Statistical Office of the European Communities. It shows that Bulgaria registered industrial growth of 3,3 % in May compared to April and of 8,6% on an annual base.

Among the Member States for which data are available for May 2008, industrial production fell in eighteen and only rose in Ireland (+13.3%), Bulgaria (+3.3%) and Romania (+0.5%). The most significant falls were registered in Lithuania (-7.5%), the Netherlands (-6.0%), Portugal (-5.7%) and Latvia (-5.6%).

In May 2008 compared with May 2007, production of capital goods increased by 2.2% in the euro area and by 1.9% in the EU27.

Among the Member States for which data are available for May 2008, industrial production rose in twelve and fell in nine countries. The highest increases were registered in Ireland (+9.2%), Bulgaria (+8.6%) and Denmark (+7.4%), while the most significant decreases were recorded in Latvia (-8.1%), Estonia (-6.7%) and Greece (-6.6%).

Not only has Bulgaria dominated Knight Frank’s Global House Price league tables for the past year, but its mortgage market is now one of the strongest in Europe, even amid the prevailing worldwide credit crunch

Bulgaria’s real estate market has been the world’s strongest since 2007, according to the latest Bulgarian Banking Sector Analysis published by leading research house RNCOS. Even in the midst of an international credit crunch, Bulgarian property buyers took out over €2.5bn in mortgages over the past year, a trend that is expected to see an unprecedented forecast CAGR of 88% by 2010.

Housing loans now account for over a third of all lending products in the country, making Bulgaria one of the fastest growing credit markets in Europe, bolstered by a huge increase in mortgage products which offer attractive incentives for investors.

Bulgaria’s real estate market has consistently beaten all records and expectations. Bulgaria recently clinched its third consecutive placement at the top of Knight Frank’s Global House Price Index for the first quarter of 2008, with an annualised growth of 31.5%. Bulgaria beat France, Hungary, Austria, Switzerland, Poland and Denmark, all of which recorded 3% growth or less for the first quarter of 2008, while convincingly outpacing Lativa, Estonia and Northern Ireland, which all recorded negative growth of -20% and less for the year.

Analysts remain extremely optimistic about Bulgaria’s long-term growth, in part due to its bourgeoning tourist industry. Tourism is tipped to increase by over 10% in 2008 according to the State Tourist Agency, and the country’s image as an emerging tourist hub is expected to be bolstered with the addition of multi-million euro golf clubs and resorts in the Black Sea region.

Currently there are nineteen golf courses being built in Bulgaria, including a €50m development near Pravets, and experts believe that strong investment interest will eventually lead to the construction of up to forty more resorts in the near future.

In a further show of confidence, American investors who have been hard hit by the credit crunch have put over $1bn into Bulgaria, seeking to capitalize on Bulgaria’s growth boom. According to Borislav Boyanov, President of the Bulgarian American Chamber of Commerce, Bulgaria’s NATO and EU memberships, its 10% corporate tax and the agreement on joint military facilities between the US and Bulgaria have contributed greatly to this investment boom. “The world economic crisis and its global consequences have not affected any essential aspects of Bulgarian-US economic relations. US investors keep coming because Bulgaria is a strong emerging market and continues to create favourable business conditions”, Boyanov said.

Knight Frank, Global House Price Index (annual % growth)

By Landlord Expert, UK

According to a new statistical report compiled by Obelisk from Google AdWords, the number of investors looking for overseas property investment is now at a high. Since the emergence of the sub-prime crisis last year, overseas property investment interest has increased by a massive 96% to January 2008, according to reports from Google. In fact, Google AdWords’ searches for overseas property investment are now at their highest levels since June 2007 rising by 80%, clearly indicating that overseas property investment is now the preferred alternative to stocks and shares.

Experts within the National Association of Estate Agents (NAEA) have also provided evidence that in recent months overseas investment has grown, lending further evidence that overseas property investment is well on its way to becoming the option of choice. Countries such as Bulgaria, which in many places realized 30% property price growth in 2007, have clearly highlighted the investment potential to market professionals and investors.

By Kerin Hope and Theodor Troev
www.ft.com

As the global credit crunch tightens, British and Irish home buyers, who drove the development of Bulgaria’s Black Sea coast, are being replaced by cash-rich Russians and Romanians.

A sharp fall in demand for smaller studio and one-­bedroom apartments of between 40 and 60 sq. m. in established resorts has pushed down prices by between 8 and 12 per cent in the past six months, according to estate agents. Prices now range between €800 and €1,200 a sq. m. in new developments, depending on proximity to the beach. But rental yields are low, at about 2-3 per cent, because of a relatively short summer season and an over-supply of smaller apartments. The re-sale market is still in an early stage of development, although many speculative buyers have already “flipped” properties acquired earlier. Yet the mood is still optimistic. Not only are more Russians, Poles, and Romanians expected to join the market for moderately-priced apartments, but a growing number of high-end projects are being launched in previously undeveloped areas. Land prices are soaring, especially in the “villa zones”, a 10km strip around regional coastal towns that municipal planners allocate for suburban development.

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www.holidaylettings.co.uk

Bulgaria, Turkey and France are the three countries set to see the biggest growth in demand among overseas property investors, a new survey has found. Fly2let.co.uk reports that the NatWest International Personal Banking League of Buying Abroad found that 75 per cent of mortgage brokers expect to see an increase in the number of people looking to buy in Bulgaria in the next three years. Turkey (56 per cent) and France (46 per cent) are also expected to see a rise in demand, it was found. Portugal (41 per cent) and Spain (31 per cent) complete the top five locations predicated to be popular with investors.

Speaking to the website, Mike Freer, head of business development for the bank, said: “With the expansion of the EU, better transport links and an increase in low cost airlines offering cheap available flights to countries all over the world, the choice when buying abroad has increased significantly.”