LM Legal Services Blog

The priceses of houses on the Black Sea coast in Bulgaria have fallen on average by 26% and in some cases they go as low as 200 Euros per sq m.  However, the supply of properties for sale has dimished as only owners who need cash urgently sell.  The supply of properties in the southern part of the Bulgarian Black Sea coast has dimished more then the one in the northern part. The prices in the south vary from 400 to 935 Euros.  In some villages the prices of houses have fallen from 13% to 26%, while in other the prices have not changed and even increased by 3%.  The prices in Sveti Vlas for example have gone up by 4% because the number of old houses for sale has descreased while the number of the luxury newly built properties has increased.  In one year the price has risen from 887 Euros/sq m to 923 Euros /sq m.  Similar is the situation in Chernomorets, which has  become popular in the last four years.

In comparison to the south, the properties on the Bulgarian northern coast have always been more expensive. However, the tendency there is exactly the opposite – the prices of houses have decreased and now they vary from 300 to 730 Euros/sq m. The highest price drop is in Kichevo where last year the choice of houses for sale was twice greater than now and the average price was 764 Euros/sq m.  Now, the average price is 593 Euros/sq m.  In other places like Shkorpilovtsy the number of the properties for sale in June 2008 is exactly the same as in June 2009, but the price has dropped by 14% to 593 Euros/sq m.

In general, the analysts think that the prices of houses on the Bulgarian Black Sea coast will not drop too much as their number is limited and already their price is lower than the one of the apartments in the newly built developments.

Until now the information about repossessed properties offered at auctions was only available at the offices of the private judges, in the municipalities and the in the regional courts. Often this information which had to be available a month before the auction disappeared.

Now, the cheap repossessed properties which judges sell in Bulgaria can be found on the web. The Chamber of the Private Court Executors publishes information for upcoming auctions at http://www.sales.bcpea.org

At the moment there are 164 announcements for the sale of all types of property – apartments, houses, warehouses, plots of land, etc. The information is constantly updates. The highest number of announcements have been made by the Sofia City Court. Among them are auctions for apartments with a starting price of up to 60 000 levs (30 000 Euros) . For example, the bidding for a one-bedroom apartment on Alexander Stamboliysky Boulevard will start at 52 400 levs, while the bidding for the same size of apartment by located in Hadji  Dimitar at 65 000.  Bidding for apartements in the areas in the outskirts of Sofia start at under 20 000 Euors.  The announcement coming from other Bulgarian cities are quite interesting.  In Varna the bidding for a two-bedroom apartment will start at 80 000 levs and for a villa at 105 000 levs.  In general currently there are eight houses in the country at prices under 10 000 levs.  The most expensive offers are: a factory in Burgas with a starting price of 29 826 750 levs and a house in the affluent Dragalevtsy in Sofia with a starting price of 760 000 levs.

If an auction fails and nobody bids for a property, there is a second auction and the price drops by 20%. The successful bidders must pay the whole amount of the price of the property within 7 days. Potential bidders’ only worry is that the former owners of repossessed apartments can appeal against the repossessions.

According to the British estate agents Knight Frank by 31 March 2009 the property prices in Bulgaria have increased by 3,3% annually and in the first three months of 2009 they have decreased only by 1,2%, which puts Bulgaria in ninth place in terms of property price growth.

The information provided by the Bulgarian National Statistics Institute (NSI) shows that in the first quarter of 2009 the property prices have fallen by 12,4% and by 8,4% on annual basis. According to NSI from January to March 2008 the properties in Bulgaria cost on average 1299,9 levs (650 Euros) per sq m. In the first quarter of this year this price has fallen to 1190,7 levs (just under 600 Euros) per sq m. If the information of the NSI is taken into account, then Bulgaria will be in the top ten shrinking property markets.

In the first quarter of 2009 the property prices in 32 out of 46 countries world wide have fallen. The most serious price decrease has been in Singapore, Dubai and Latvia. In Latvia alone the prices of property have been steadily falling in the last two years and only in the last 12 months they have fallen by 36%. In Dubai the prices have fallen by 40% only in the last three months. The short term forecast is that the recession will continue at least until the end of 2009.

The price of agricultural land in Bulgaria has decreased by 40% in the first months of 2009 in comparison with 2008. The reason for this is the recession and the boosted prices of agricultural land in the beginning of 2008. This has put off many prospective buyers.

At the moment the average price is between 200 and 300 levs per 1000 sq m.
The top most expensive agricultural land is in north-east Bulgaria, in the area of Dobrudja, while the cheapest around Vidin in north-west Bulgaria, Haskovo in the south, Lovetch and Gabrovo in mid-Bulgaria and Pernik, close to Sofia.
Despite the price drop, the rent of agricultural land steadily increases. At the moment the average rent is between 18 and 20 levs per 1000 sq m, which is an increase of 10 levs in comparison with the same time last year.

Unlike earlier expectations the market of luxury property in Bulgaria has also experienced price decreases. Rich buyers bargain and refuse to pay the high prices for top properties in the Bulgaria. As result prices of luxury properties have dropped by 1 million levs on average according to market analysts. The most striking example is a luxury apartment close to the National Theatre in Sofia which appeared on the market last year with asking price of 2 million Euros. The total area of the apartment was 253 sq m and this was the top price for the country – of 7905 EUR per sq m. The apartment is located in a listed building constructed in 1912. A year later the seller has dropped the asking price to 1,5 million EUR or 5929 EUR per sq m.

At the same time the price of a house close to Perla Hotel in Dragalevsty has dropped by half a million Euros to 2,5 million EUR. The total area of the three-flour house is 900 sq m and it has 7 bedrooms and six bathrooms as well as inside pool, jacuzzi and sauna.

Another striking example of a price decrease of a luxury property is in the affluent suburb of Plovdiv – the village of Markovo. A year ago this property, with total are of 2417 sq m used to sell for 2,5 million EUR. In the last few months its price has dropped to 2 million Euros.