Archive for June 2012


SOFIA AND ATHENS – A COMPARISON OF RENTS

June 25th, 2012 — 11:41am

The rents in Sofia have dropped by 20% in the first six months of 2012 while in the crisis stricken Athens the rents have dropped by 12%. The annual yield of properties in Greece however has dropped by 50%. While in Greece the drop of the rents was due the crisis and is a continuous trend since the autumn of 2011, in Sofia the drop of the rents was due to the construction of the second line of the underground that took place in the major central streets and boulevards of the Bulgarian capital.

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CONSTRUCTION INDUSTRY IN BULGARIA

June 15th, 2012 — 3:40pm

Although the production of the construction industry in Bulgaria has dropped to 43% of the volume DURING the peak of the boom in 2008, in April 2012 the National Statistics Institute registered an increase of 0.2% and an annual increase of 4%. The increase of the construction of apartment buildings and offices was 0.2% in April 2012 and 0.1% on an annual basis.

CONSTRUCTION INDUSTRY IN BULGARIA

Although the production of the construction industry in Bulgaria has dropped to 43% of the volume DURING the peak of the boom in 2008, in April 2012 the National Statistics Institute registered an increase of 0.2% and an annual increase of 4%. The increase of the construction of apartment buildings and offices was 0.2% in April 2012 and 0.1% on an annual basis.

CONSTRUCTION INDUSTRY IN BULGARIA

Although the production of the construction industry in Bulgaria has dropped to 43% of the volume DURING the peak of the boom in 2008, in April 2012 the National Statistics Institute registered an increase of 0.2% and an annual increase of 4%. The increase of the construction of apartment buildings and offices was 0.2% in April 2012 and 0.1% on an annual basis.

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BULGARIAN PROPERTY MARKET

June 1st, 2012 — 12:45pm

The number of the properties for sale in Bulgaria exceeds the demand by 50% and in such kind of situation it seems very unlikely that the property prices will rise. In Sofia there are on the average 37 property purchases per day and the first feeling is that the market is getting livelier. However, this number is by 9% lower than at the same time last year.
Unlike a few years ago it is cheaper to rent a property than to buy a property. The yield of the property is much lower than the interest acquired from keeping money at a bank’s savings account. Most likely those who buy properties for investment in the next 1-2 years will lose money. For example, a two-bedroom apartment bought at 60 000 Euros can be rented for 200 Euros per month and the yield is about 4% annually. In a bank savings account the same amount can acquire an annual interest of 6% without any additional expenses like maintenance and repairs. The situation in the destabilized Greece has also its impact on the property market. Only a high inflation can change this and can turn the purchase of a property into a profitable operation. At this stage this does not seem to be possible in the near future.

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