Tag: repossessions

Bankrupting Hotels

June 10th, 2009 — 1:50pm

According to the State Agency for Tourism (DAT), three-four hotels go bankrupt every week in Bulgaria. They are unable to re-pay their mortgages. Many hotels are put for sale but there are no buyers and banks repossess them but it remains unclear if the banks will be able to sell them.

It seems that Bulgaria follows the road of Spain where the state buys the bankrupted hotels and demolishes them, in order to create parks.

According to the statistics, in the first half of the last year, 820 new hotels have opened on the Black Sea coast. As result of the construction boom the number of hotels and holiday properties is much higher than the number of  the tourists.  Many hotels can not sell all their beds and their owners suffer losses. All this makes it impossible for the hoteliers to repay their mortgages and other credits and go bankrupt.

Comment » | Bulgaria, Property


May 28th, 2009 — 10:46am

A repossessed one-bedroom apartment in an affluent area of Sofia can be purchased for 25 000 Euros at an auction. According to the court statistics there is a boom in the number of the auctioned repossessed properties in the last few months. The information about these auctions is displayed in the municipalities and the auctions take place at the regional courts. A repossessed property is evaluated by a judge who then auctions it at 50% of the market price. Due to the recession and the collapse of the property market, there is no interest in repossessed properties. If such a property does not sell, it is offered again at an auction a month later at a price which is further 20% decreased. The expectations are that the number of the repossessed apartments will continue to grow.

1 comment » | Bulgaria, Property


October 30th, 2008 — 11:31am

Each week about 20 new repossessed properties are declared at Sofia Regional Court. All repossessed properties are listed in the Third Civil Department of the regional court.  Most of them are apartments, houses and bigger buildings, agricultural land and regulated plots.

One-bedroom prefab apartment in Liulin gets a starting price of 36 000 levs, while an apartment of the same size in Mladost 4 -  74 000 levs.

A three-storey building in Vassil Levski Boulevard in the centre of Sofia has a startign price of 821 000 levs, while an apartment of 100 square metres in Strelbishte has a starting price of 205 000 levs. At the same price will start the auction for a plot of land of 5 000 square metres in Vrajdebna, a suburd of Sofia. The most expensive repossessed car has a starting price of 4 800 levs.  In the process of auctioning the price very often is increased by 100%.

Comment » | Bulgaria, Economy


September 1st, 2008 — 4:50pm

All repossessed apartments which are sold by the judicial executors are already publicly announced in the regional courts. This practice came into effect with the launch of new Civil Procedures Code on 1 March 2008. Before that all judicial executors used to hide these sales as usually these properties have been sold for very cheap and well informed buyers used to acquire them.

The lists in Sofia are published in the family department of the Sofia Regional Court, which is situated in the building of the former head quarters of the Building Corps on Tsar Boris III Blvd. Because of the court holidays in August, the building was closed, but now it has re-opened doors. Already there are companies which purchase apartments at these sales at a much lower price and then re-sell them.

The banks wait for a few months for clients who are late with their mortgage instalments. After that they sale the repossessed property, and if the sale price exceeds the amount of the debt, according to the law, the former owner receives the difference. According to the Chairman of the Private Judicial Executors’ Chamber, “the problem is the sale price of a repossessed property, because it has to be 50% of the tax evaluation as per the new Civil Procedures Code and it is rather low.” That is why the judicial executors are forced to give higher evaluations of the prices of repossessed properties.

Comment » | Bulgaria, Legal

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