August 26th, 2009 — 10:35am
The prices of properties on the Bulgarian Black Sea coast have dropped by 15-30% while those of inland properties by almost 70%.
Newly built apartments sell for 390 Euros per sq m. In Sunny Beach there are completed apartments for sale for 20-30 000 Euros, which is below their value.
Properties in the big cities like Sofia, Plovdiv, Varna and Burgas have dropped their prices by 30%.
Some analysts claim that the buyers now come mostly from Russia and the former Soviet republics and that there is no recession on the property market in Bulgaria but just restructuring. The quality properties keep their prices while the low quality ones sell at their real price which is a positive tendency, according to them. The Russians mostly buy luxury properties on the northern Black Sea coast at prices exceeding 250 000 Euros. The interest towards mountain resorts has decreased.
Comment » | Bulgaria, Property
August 21st, 2009 — 10:26am
A new public institution will be set up in Bulgaria to manage and control amounts from all real estate transactions in an effort to bring them into the light and crack down on money laundering in the industry.
The new Deposit and Consignation Fund will be inaugurated by special legislation hammered out by the Ministry of Justice and the Notary Chamber.
The institution will be a state-owned enterprise and not a bank and will be modelled on a system already operational in France, said Notary Chamber head Dimitar Tanev. Under the scheme, the sellers will receive their money with a short delay but it will ensure transparency and security to all loyal parties as well as central and local authorities.
The system will see buyers transfer the money into the fund where it will spent two or three weeks before it is passed on the seller. The period will be used to check up the resource’ origin and charge all dues of the government and municipalities. It is expected to put an end to sham transactions and block cash payment as money will have to be put into the fund by a bank transfer, Tanev explained.
Market values in the different regions will be determined by experts and updated every three or four months. The price will serve as a reference point for actual property transactions to make sure money laundering and tax evasion is prevented. A difference within 10-15% could be assumed thanks to property improvements but current differences topping out at between 300% and 1000% will be impossible, Tanev said.
The Notary Chamber discussed the proposal with representatives of the European anti-fraud office OLAF, who said the project will indicate the country’s commitment to combat abuse and money laundering.
Comment » | Bulgaria, Legal, Property
August 11th, 2009 — 11:39am
The Bulgarian economy will continue sinking in 2010. The decrease of the GDP will be of 1%, according to the Agency for Economic Analysis and Forecasts. For 2009 the expectations are of a significant decrease of the GDP of 6.3%. Bulgaria will be in recession for two consecutive years. The decrease of the investments and the retail index will continue in 2010. The expenses in Bulgaria’s budget will not increase in order to avoid deficit. The major reason for this is the world wide recession. Although there have been signs for upcoming end to the recession in the USA, the risks for the world and the European economy are still there.
The slowing down of the economies of Bulgaria’s major trading partners has led to shrinking of Bulgaria’s export. The export of goods has decreased by 30,7% in the first five months of this year and it is expected that the decrease will be 10,5% on an annual basis. This has its effect on the transport and freight. As result the total volume of the export will shrink by 12,3%. The limited crediting and the slow increase of the personal incomes has led to a decrease in the investments and the sales in the country itself. The expectations are that in 2009 the spending of the average household will shrink by 4.5% and of the government by 3%.
In the following years the domestic demand, which has been generating mostly by the foreign investments, will be hard to resume the growth of the Bulgarian economy to the levels of the last years. That is why the recuperation of the economy is expected to materialise through the export. Having in mind the current world wide tendencies, this will not happen in 2010. To the contrary, the export will continue decreasing and the expectations are that it will shrink by 3,8% next year. That is why the forecast is for economic decrease of 1% in 2010. This will be accompanied by relatively low inflation about 2,2%.
Comment » | Bulgaria, Economy
August 10th, 2009 — 12:09pm
In the first half of 2009, the worldwide recession has had its effect on the market of commercial property in Bulgaria – the number of frozen and delayed projects of shopping centres and malls.
Among the frozen projects in Sofia are Euro Park for 500 million Euros, Sofia Acropolis for 500 million Euros, Tsarigradski Mall (35 million Euros) and GLS Mall. In the country the largest frozen projects are Grand Gallery in Burgas for 35 million Euros, Litos Ibuild in Pazardjik and two shopping malls in Kazanluk.
At the same time GTC has delayed the completion of its three Gallery projects in Russe and Burgas by 6 months, and in Varna by 4 months.
Since the beginning of the year two bid shopping malls have been completed – Mall Plovdiv and Burgas Plazza with rental area respectively of 20 000 sq m and 26 000 sq m. With them the total area of all shopping centres in Bulgaria has reached 233 460 sq m, an increase by 25% in comparison with the end of 2008. At the end of June 2009 there are 31 sq m of retail space per 1000 people, while in 2008 it was 25 sq m.
At the same time the average decrease of the purchase price of the commercial properties in Bulgaria in the first half of 2009 is of 6.71%. There is also a decrease of the rent of 18% on average for the country. The highest decrease both in purchase prices and in rents is in Sofia and the big seaside towns. The rents in the shopping centres in Sofia have fallen by 25% and vary from 12 to 45 Euros per sq m. The analysts expect a further decrease by 15% by the end of 2009.
Comment » | Bulgaria, Property
August 10th, 2009 — 11:44am
The construction of buildings in the forests will stopped with a moratorium on the change of the purpose of exchanged land formerly belonging to the State Agricultural and Forestry Fund, according to the new Bulgarian Minister of Agriculture Miroslav Naydenov.
Comment » | Bulgaria, Property