Dear Valued Stara Planina Properties Client,The November issue of our company newsletter is with you. Included below is a short article our director prepared for an overseas property magazine recently. It concerns developments in the Bulgarian property market. We hope you will find this insider's view of interest.
In the past in the minds of most Brits Bulgaria was associated with perhaps two key moments in history, the first connected with the intrigue killing of Georgy Markov on Waterloo Bridge by use of a poison tipped umbrella, secondly, in some blurred manor, with the attempted assassination of Pope John Paul II. But this has changed in the last 5 years as Bulgaria has emerged as one of the leading overseas property hot spots.
As a British national I have lived and worked in Bulgaria now for over 8 years and I thought to share with you my views and experiences.
My first contact with Bulgaria occurred more than 10 years ago when my business partner Mr Andrew Anderson and I first passed through Bulgaria en-route from London to Istanbul on a sponsored bicycle ride. Two years later we found ourselves back in Bulgaria working as technical advisors for an EU funded building and renovation project managed by the United Nations. It was through this technical experience and a deep attachment to the country that the idea of the company evolved. In 2001 we assisted Channel 4 in the making of A Place in the Sun. In 2004, in partnership with ITV, we assisted them in the making of I Want That House featuring Bulgaria. More recently we have been working in collaboration with Real Estate TV The Next Big Thing Bulgaria.
Over these years we have seen many changes in Bulgaria and indeed in the property market itself. The days of returns exceeding 50% per annum are well behind us as some stability and maturing of the market takes place. Nevertheless, Bulgaria to my mind still represents excellent value for money compared to other destinations and, with continued strong economic growth predicted following EU membership, should deliver excellent investment returns. However, I think that people have to take more care in the selection of what they buy and where they buy to optimise their returns.
I heard at a recent overseas property show in the UK that during an open discussion on Bulgaria, people inside the hall were asked what their reasons for buying in Bulgaria were. Only one hand went up professing lifestyle choice. This saddened me somewhat but perhaps was to be expected. Destinations like Tuscany, Provence and Spain are attracting many lifestyle buyers, whilst Bulgaria's first characteristic seems to be a 'cheap' place. However Bulgaria has a lot more to offer than cheap beer and property. It should not surprise visitors that Bulgaria was considered the top holiday destination for East Europeans during the communist era. It is a country blessed with some of the most spectacular landscapes in Europe and with a people both gentle and welcoming.
So where should you buy? This is obviously a very subjective issue. People have their own balance to match against investment returns and lifestyle choices. Broadly speaking this is our perspective on the options.
Many buyers speak about investment properties and generally any investment in Bulgaria is likely to be a good investment, however, it is clear from current projections that central urban areas and high spec properties are expected to see the strongest growth in returns (they also have a good rental market). Cities such as Sofia, Plovdiv, Varna, Bourgas, Rousse, and VelAs an alternative, buyers can look to other areas that offer a stronger lifestyle element such as the ski resorts (Bansko, Borovets and Pamporovo) or along the coastal strip - centered on Varna in the north and Bourgas to the south.
For those looking for a more rural setting and low entry prices then regions such as Veliko Turnovo and Rousse are the favoured destination. These areas are located in the central northern parts of Bulgaria and appear to be the preferred destination for clients thinking of starting a new life in Bulgaria.
So how do we go about buying in Bulgaria and what are the issues to take care about? Many people are perhaps daunted by the prospects of buying in an emerging market. Indeed, trying to find the right agent to work with, who can give you the appropriate advice and see the deal through to completion is becoming increasingly difficult given the bewildering number of agents that have emerged on the market. Here is some advice I can share with you.
I think it wise to shop around in finding an agent. When deciding your budget, think of all the costs from purchase price to legal taxes and agentB??s fees. Do not be drawn to an agent simply by low fees as additional costs can be hidden by agents in the price of the house.
Debts on properties stay with the property and not the person. So ensure that whoever you are working with checks carefully the state register of debts on a property. Another problem in Bulgaria is unclear boundary definition. Ensure your agent has all the borders regulated correctly before completing to avoid any conflicts in the future.
In conclusion, when buying in an emerging market, pay close attention to where the domestic market is going. Buy central, high spec properties that will cater to an ever developing middle class rental and buyers market (not just foreign). For lifestyle buyers: your decision criteria can be more flexible and at the end of the day are yours to make. The wonderful thing about Bulgaria right now is that even lifestyle buyers can feel confident that their investments will grow. But none of these lifestyle dreams or investment returns can be realised without the use of a competent agent so shop around and choose carefully.
Stephane Lambert, Director
Stara Planina Properties
Approaching the date of joining the European Union the biggest Bulgarian city on Danube River Rousse has started to prepare to take its place on the map as a key emerging EU city. As part of these developments the municipality of Rousse will establish a partnership with private investors for the construction of a massive sports hall and shopping mall.
The Rousse Council invited the potential partners to present their ideas for the project which will be built over 40,000 sq m in the centre of the city.
The Mayor of Bansko Alexander Kravarov announced that the Municipality will issue no permissions for new construction in Bansko after January 1 2007 until the new urban plan of the resort is completed. Afterwards construction would be permitted only in certain areas.
Mr Kravarov told Darik Radio that nearly 300 construction permits were issued in Bansko in 2005 and 2006 and a number of additional applications were pending and over-construction was the main problem the resort experienced.
More and more Japanese tourists are interested in visiting Veliko Turnovo - the home town of Bulgarian sumo wrestler Kaloyan Mahlianov Kotooshu. The Mayor of Veliko Turnovo told the media that 30 per cent more Japanese tourists were expected to visit his birth city of Veliko Turnovo in 2006 as compared to figures for 2005. Kotooshu was very popular in Japan thus causing growth in the number of Japanese visitors to Veliko Turnovo.
According to the Mayor Veliko Turnovo attracted foreign tourists because of its cultural, spa and sport opportunities. Neatly 11 000 people visited Bulgarian spa hotels in Veliko Turnovo. Foreigners coming to the city were mainly from France, Italy and the UK.