Buy & Sell Bulgaria Insight Newsletter

Reviewed by Diana Georgieva

Q: How can we find our dream property in Bulgaria?

A: Buying a property overseas can be one of the most rewarding investments you will ever make, as long as you take it easy and approach it slowly and attentively. A recent poll revealed that 40% of Brits are actively thinking about buying overseas .

This impulse usually arises after spending your holiday at a place which you simply fall in love with – our experience has proven this many times. If you decide to buy a property in Bulgaria, make sure you visit the place at least a few times over the course of a year to get a realistic idea of life there 24/7.

Also, don’t forget to look out for all facilities that are important to you – such as shops, transport links, healthcare, etc. Here applies the well-worn (actually true) quotation that it’s all about “location, location, location”.

Most important is to trust your real estate agent who should be able to answer all your queries and guide you through the entire purchase process. They will defend your personal interests and take care of the complete transfer of the deeds, advise you on building permits and all kind of state regulations, taxes, etc.

When buying a property with Buy-Sell-Bulgaria Ltd. you will receive the utmost attention and respect of your needs and requirements, professional advice and be sure that no information will remain hidden from you!

I’m waiting for your comments and questions on e-mail: diana@eurolink-finance.com

The demand for new construction permits in Bulgaria picked up in the second quarter of the year, with Black Sea port of Varna receiving the largest number of permits, statistics board NSI said on Thursday.

The total number of building permits issued in April-June was 4.660, compared to 4.049 permits issued in the previous three months.

Varna accounted for more than 15% of all new permits - 712, followed by Burgas with 587 permits and Plovdiv with 476. Capital Sofia got 320 permits.

Permits for residential buildings totalled 2.735 for a total 1,67 million square meters of housing.

Administrative buildings permits totalled 85 for the period.

By Christopher Violaris, BSc, MSc, PhD ( Econ)
Chairman and C.E.O of Eurolink Investment Group

You may ask, what is the best way and where should somebody invest. We are listing below some facts that will allow you to draw your own conclusions:

What is the future of your investment in Bulgaria?

Once again the answer to this question is complex and depends on a lot of factors! Generally, all investments will deliver profits and dividends, some more and some less, though there will be a good number of the so-called “investors” who will be totally disappointed, even lose their money! As you know not everything that shines is gold and not every “purchase in Bulgaria” will make you rich and we will explain what we mean:

1 - The loser: Those of you, that bought properties in remote areas, uninhabited villages, or villages with gipsy population, land and plots that have no access to electricity or water or where the network is not extensive enough to sustain additional construction, I am afraid that you are in for a very long “wait” in the best case or losing your money in the worst case.

2 - The “moderate” winner: Those of you, that bought apartments on the South Coast or on the Ski resorts, with the assurance and “guarantee” of a rental income, should have by now realized that you made a mistake and the “myth” of the rental income does not represent reality. In fact it will take years until the hotel rooms are filled by the tour operators in a way that your apartments can offer themselves as an alternative to hotels. It is important to underline here that 92% of the tourists coming to Bulgaria every year, come on a “package tour” that includes tickets and hotels. On the contrary, those of you who bought apartments in Sofia, Varna region and in other major towns, you stand a very good chance of receiving a decent rental income and have some returns from your investment. In a long term, the prices of apartments will go up and you should expect, depending on the location of your apartment, a moderate profit (7-10% per annum).

3 - The “money maker”: The real money maker is definitely Land and Plots! Those who were wise enough to put their money on land and plots, already know that they are in for a “kill”! If somebody goes back a few years and compare the prices of land then with those of today, he will realize that we have an average increase of 68% per annum, especially those who bought prime land at prime and popular locations can expect some impressive price increase and investment return in the near future! Demand for land is not only growing by an average of 32% per annum, but it is also widening in its form and it covers now the commercial as well as the agricultural sectors. We have for example parties interested in land for warehousing and distribution, for commercial and medical centers, scuba diving schools, summer language schools, etc. Our advice to you is very simple, if you want a SAFE, HIGHLY PROFITABLE without any headaches investment, INVEST ON LAND! Remember our words!

By Christopher Violaris, BSc, MSc, PhD ( Econ)
Chairman of Eurolink Investment Group

You may ask, what is the best way and where should somebody invest. We are listing below some facts that will allow you to draw your own conclusions:

THE APARTMENT MARKET-RENTALS AND RE-SALES:

In recent years tourism has seen a spectacular increase and development in Bulgaria, something that has come about because of the huge Tour Operators’ advertising and the construction of exceptionally modern and luxury hotels on the Black Sea coast and the winter resorts of Bulgaria. Only in 2006 we had an increase of 28% of tourists spending their holidays in Bulgaria and the predictions for 2007 is even greater, 35% increase!

The role of the tour operator in the tourist industry is not just dominant but it is also absolute! Over 98% of tourists come into the country on packages bought through the tour operators, while over 85% of the flights landing at Bulgarian airports during the holiday season (summer and winter) are controlled or organized by tour operators.

With regards to hotel beds, the last 5 years have seen a huge increase both in numbers as well as quality, while in the meantime a huge number of new hotels are under construction, thus offering more and more beds. Considering all the above, we can not see how a holiday maker who can get a package all inclusive from a tour operator for a week in a luxury hotel, next to the beach or on the ski slope for €350, will be prepared to pay the same just for accommodation in a flat, somewhere in or near the resort, neither can we see how a tour operator will rent an apartment for his clients and offer a reasonable rent for the season, when he can get all the hotel rooms he needs at very low prices!

We honestly believe that investors buying apartments for rental purposes should think again! There are thousands of empty apartments in the resorts every year and they will carry on being empty for a lot of years to come! The non-existence of a rental market, therefore rental income, has naturally affected demand which has been declining year after year. Not to talk about the re-sale market which is either too small or non-existent!

READ MORE »

Great interest for our region from English, Cypriot, Greek, Italian, Maltese and Scandinavian Investors.

By Christopher Violaris, BSc, MSc, PhD ( Econ)
Chairman of Eurolink Investment Group

As a token of our long standing promise and commitment to keep our clients and investors fully informed on matters related to the Bulgarian Property Market and considering that we already entered the holiday season, I wanted to bring to your attention, a number of recent developments that affect directly your existing or future investments.

The Greater Varna Expansion Plan:

After long deliberations, changes, additions, exclusions and exceptions to the rules (this is more about culture than politics in Bulgaria), The Greater Varna Expansion Plan is expected to be approved and adopted by the Municipal Council just before the City Council members take their Summer vacations. (Read more about this topic in our BULGARIAN PROPERTY NEWS column). I am very happy to announce to you that all our regions, old and new are included in the new town boundaries and the micro regions provided by the plan. It is needless to say that upon the official publication of the plan, prices in the region will hit new heights.

I would like to disclose some details of the plan, though I am very confident that sooner than I originally thought, we may be in the position to supply you with official copies of the plan.

READ MORE »

By Christopher Violaris, BSc, MSc, PhD ( Econ)
Chairman of Eurolink Investment Group

INVESTMENT OPPORTUNITIES WITH EXCEPTIONAL RETURNS

There is no doubt that a huge amount of money has and is still being made in Bulgaria from the property market and property development. On the other hand a lot of money has been lost and a big number of people have been greatly disappointed. What shines, is not always gold and the same logic, not every purchase or investment in Bulgaria, will give you huge profits.

It is not widely known, but the estate agent’s profession is not regulated in Bulgaria and the easiest thing, is to hang a sign outside your door and call yourself an “estate agent”. In fact a recent survey showed that only 3% of the so-called “estate agents” had any qualification or professional knowledge relevant to the business. Choosing the company through which you are going to make your purchase or investment, is without doubt the most important thing in the whole chain. Your agent “can make you or brake you”! We strongly advise you to choose companies and agents with a long and proven presence in the market.

Very often you will come across to big and well known names in the industry and naturally you will have the tendency to entrust your business to them. Don’t unless you find out how long they are operating in Bulgaria and who is acting as their agent or representative. The rule in this case is to employ local staff that has no knowledge or experience and the chance of being mislead, not intentionally of course, is very big.

To be continued…

Bulgaria is the third most popular country for UK property buyers, with 7.7% of the market, just edging the US into 4th place on 7.5%, the Association of International Property Professionals (AIPP) has revealed. The position of the Eastern European country is “phenomenal”, the only market that has grown to such prominence so quickly.

“Seeing it sandwiched with Spain and France above and the US below highlights the level the Bulgarian market has reached,” AIPP explained. Paul Owen, AIPP’s chief executive said: “It’s gone from emerging to almost-established in three years, which is just unbelievable.

“It had a free run of being ‘the’ emerging market for three years, but it’s now got competition from many others coming in Poland, Latvia, and Montenegro and there are a lot of emerging nations with comparable property prices which are relatively unheard of.”

He also added that the extent of Bulgaria’s success would be revealed in the resale of homes in a few years’ time.

“There’s a lot of properties being built, there’s no doubt that prices have gone up in the last few years properties will be sold a second time around, the second wave of buyers will come in,” he added.

Real estate developers in Bulgaria have already woken up to the massive pulling power of top quality golf courses, experts say.

“Developers here have recognised that by setting a course in an excellent location and combining it with additional quality attractions such as spas, wellness centres, horse riding, tennis and so on, gives year-round appeal.

Golf is offering buyers the opportunity to buy top real estate not linked specifically to sea or ski.” With global golf tourism worth over GBP 10 B, Bulgaria has 12 new 18-hole courses in development or underway, with five due for completion by 2008. Of these five courses, 30% of the 2,300 residential units across them have already been sold.

Experts point out that Bulgaria is set to prosper from its all-new putting greens, given the success of Spanish and Portuguese golf developments and with low cost airlines further spurring golf development. By 2020 nearly every third visitor to Europe will choose a central or Eastern European destination, according to the World Tourism Organisation.

By Christopher Violaris, BSc, MSc, PhD ( Econ)
Chairman of Eurolink Investment Group

IS IT A BOOM, FASHION OR MADNESS?

Very often we are asked to explain the Bulgarian “boom”, make predictions and justify the ever increasing investor’s interest in Bulgaria! Naturally people want to be re-assured that their wish to invest in Bulgaria is correct and their investment is safe, as much as an investment can be. The answer is not always easy, especially when, what people hear is not what they want to hear! Strange as it may sound, but very often investors who have already made up their mind based on false information and facts, feel that we are trying to put them off and prevent them from taking their share of the loot!

The international press very often makes reference and covers the stories of people who were disappointed with their investment, who were mislead or even cheated and lost their money while trying to buy property in Bulgaria. Nothing new of course, considering that you hear the same stories in Spain, the occupied part of Cyprus, Turkey, Romania, etc. Why is it that all this is happening and why investor’s dreams are turned into a nightmare? The answer is very simple! IGNORANCE of the market and naivety on the side of the investor! Statements made by specific Developers, like the famous “as seen on TV” or “Guaranteed rental income” etc, should not be taken for granted and surely should not be taken as facts! What are the facts?

READ MORE »

I recently went to see Albena Cliffs. I absolutely loved the place. It has a fantastic view towards the Albena Bay and a beautiful forest at the rear. Nearby there is a new holiday village, which is almost completed. It seems that there are many others who have also seen the prospect and value of this area. The moment I put my feet on the ground, I immediately imagined myself, living in a beautiful luxurious house, laying in a sun lounger on the veranda in the sun and smelling the warm and fresh air. You should definitely check-out this project. Construction starts 2008. Buy now off plan »

The Bulgarian holiday property market will continue to grow in the years to come because of a number of factors, Managing Director of Buy and Sell (Bulgaria) Christopher Violaris said. Parallel development occurred in Bulgaria’s tourism sector and holiday property sector. Bulgaria offers a wide choice of tourism opportunities and has a competitive advantage over other countries.

Spain and Cyprus are dynamic and developed property markets but have reached a saturation phase. This gives Bulgaria the chance to develop its property market. British property buyers still represent the largest group of foreign investors in the country. EU membership is a plus as it makes people more comfortable buying property in Bulgaria.

The future of the market is in the development of Bulgaria as a golf property destination and promotion of the country as a permanent living destination. Environmental concerns and the introduction of Natura 2000 were going to bring about balanced development. Climate changes and the milder weather could further increase the appeal of the country.

France and Spain, traditional favourites for British property buyers, are losing out to a handful of emerging markets such as Bulgaria, a recent survey shows. The annual global property hot spot report, recently released by currency specialists HiFX, puts the shift partly down to a new spirit of adventure in British buyers.

Our Project at Albena Cliffs

“In many cases the emerging markets offer property, which is significantly less expensive than the traditional favourites,” Mark Bodega, marketing director of HiFX, commented.

“As UK property prices have continued to rise dramatically in the UK over the last 12 months, combined with rising interest rates, we’ve seen the overseas property market open up and become accessible to more of the UK population.”

The company also puts the rise in interest in lesser known destinations down to a shift away from people purely buying holiday homes, towards more serious property investors.

“As people look to where they can make the most money and returns, they are more likely to look away from the traditional markets to areas of expansion and new development”, says Bodega.

“We’ve seen properties in the emerging markets snapped up by investors in 2006. Bulgaria remains a popular investment destination with investors keen to cash in when it joined the EU.”

Average price levels of residential properties on the Bulgarian middle market will increase by 5-10% in 2007, experts say. Luxurious newly built apartments and properties at key locations will command a higher increase in prices - an average of 15%, according to realtors’ forecasts for the country’s first year of EU membership, cited by 24 Hours National newspaper.

Low prices, long-term investment prospects and changes in lifestyle fuelled record-high property sales in Bulgaria for 2006. The year-end count of transactions is forecast to reach 260,000 at a combined value of more than € 5 Billion, according to our figures.

The experts comment that following the massive 25% to 30% annual capital gains of recent years, Bulgaria’s property market is now showing a much more realistic growth rate of 15% so far this year, setting the pattern for more predictable and sustainable long-term investment. In 2006 the real estate market was dynamic, with a gradual development of the prices. The number of transactions equaled 280,000 for the year which is an increase of 15% compared to the previous year, said Alan Coleman, Acting Deputy Managing Director of Buy & Sell (Bulgaria).

Real Estate Investments in Bulgaria put the country up to sixth place in the world rankings according to foreign investments in real estates statistics.

Bulgaria’s property market will increase its appeal following the country’s accession to the European Union. One in seven Britons is considering purchasing property in Bulgaria, following the country’s EU accession at the beginning of this year, according to a new survey. The number of foreign visitors to Bulgaria went up by 8.3 % last year, bringing the total in 2006 to 1.5 million. Bulgaria’s official inclusion in the European Union is a key opportunity for property investment in this emerging market, commented Alan Coleman, the Sales Director of Buy and Sell Bulgaria Ltd, member of Eurolink Investment Group. Based on the past history of other Eastern bloc countries joining the EU, where property prices have risen significantly these markets look set to become strong areas for capital growth.