5% of the newly built hotels will become ‘dead zone’ within 10 years – abandoned hotels with stolen windows, doors and tiles, hanging cables and no roofs, according to analysts.

At the moment 20% of the hotels in Bulgaria are closed and at least 5% of them are not viable from a business point of view in terms of position, size, materials and type. If these hotels are not restructured within the next few months, one year the most, they will continue incurring loss.

Experts say that the solutions for such kind of hotels is to turn them into hospitals, hospices, old people homes and even jails, children’s camps, business centres or apartment buildings and to sell them. Still it is early to say that there is such kind of tendency in Bulgaria. At the moment there are more than 700 hotels and apartment complexes for sale in the whole of the country.

This negative tendency will affect a great part of the many apartment  complexes in the next three years.  Some analysts think that a possible solution to the problem is to introduce the necessary legislation which will allow timeshare in Bulgaria. The purchase of a holiday home or apartment is not profitable at the moment because of the high prices and the fact that it is usually used for about a month per year, according to experts.

The slowing down of the Bulgarian property market is most obvious at the Black Sea resorts, namely the Sunny Beach and the Golden Sands, and in the mountain ski resorts like Bansko and Pamporovo. The price of properties there have reached their peak levels and the number of purchases has been falling. There is no demand for such properties, while the the properties on offer are many. This is the reason why the Bulgarian banks avoid financing such purchases, as well as the construction of properties along the coast. According to leading business and legal advisers, the prospective investors can not  rely on off-plan sales at the moment. Many hotels along the Bulgarian Black Sea coast have been put up for sale and there are no prospective buyers interested in them. This means that most of them will be acquired by the Bulgarian banks which credited their construction. In the long run if the intensive construction does not stop, many hotels along the coast will have to be demolished like in Spain. However, in order to do this, a new legislative framework needs to be introduced by the Bulgarian parliament, and leading solicitors have been investigating the Spanish experience and preparing the necessary amendments to the current Bulgarian laws. Generally, the lawyers and the law companies seem to be more occupied than anybody else involved in the construction business.

Away from the Black Sea and the mountain resorts, the Bulgarian property market keeps moving because traditionally Bulgarians consider buying a property not only an investment but  most of all a form of security.