BOOM! If you think 2016 was great for the Bulgarian real estate market, wait till you see 2017!
The Bulgarian real estate market soared with over 100,000 successful transactions in 2016, reaching an impressive total of 500mln EUR invested in residential property. This never before seen boost in demand represents double-digit growth when compared to the previous year (2015). As a result, buyers are willing to pay on average from 900 EUR up to 1,550 EUR per m2 for high end apartments within upscale residential complexes from high-market developers like Arteks, SofBuild, and InveStellar. A trend of consumer preference toward 2 and 3-bedroom apartments have pushed real estate prices as high as 200,000 EUR, with the majority of purchases made by foreign investors, interested in participating in the market upswing. This combination of domestic and foreign demand has reignited the spark of development with forecasts showing that it is only going to get better!
2017 is on track to be the most exciting and dynamic year for Bulgarian property sales, with an impressive increase of 8.6% in Q1. During the last quarter of 2016, the number mortgage loans reached an all-time high and increased by an impressive 23.6%, while the number of equity capital deals followed closely with an increase of 11.8%. The number of successfully completed deals soared and reached 50,484 in 2016, which represents a monumental increase of 32% compared to 2015 and is a clear sign of the upcoming financial boom in the real estate market of Bulgaria.
Residential property presales rates have reached record levels, accounting for one fourth of all real estate sales and are projected to only keep increasing due to the very attractive loan conditions provided by Bulgaria’s financial institutions. Trust in construction and development companies is at an all-time high, with household and investors looking for attractive capital gains and rental returns. A trend of shying away from deposits is emerging as buyers are increasingly turning to the real estate market for long term investments.
A tide of high end residential development projects is expected to cover the Bulgarian market for the upcoming 3 quarters of 2017. The market currently offers as few as seventeen real estate investment opportunities, totaling 1650 high-end units, with 1000 more to be completed by the end of 2017. This limited supply of investment opportunities is expected to cause an upwards shift in prices of real estate, closely followed by a boom of residential developments. The excitement on the Bulgarian real estate market is expected to jumpstart the whole economy and set the pace of Bulgaria’s economic prosperity towards 2020.