Boom in property sales at the beginning of the year

The year began very dynamic with an increased number of deals for the first quarter, which is confirmed by the data of the Registry Agency. There was big activity especially in the beginning of the year up to mid-February, when buyers were extremely active and even had a shortage of quality offers for sale.

In January, the sales nearly doubled from January 2012, and this put the month among in the strongest months of the beginning of the crisis, which is unusual for this time of the year. By mid-February we have embarked in a short period of waiting, because market participants wanted to see how events will develop from the political life of the country.

At present, the dynamics are comparable to that of last year and the property market has developed, according to our expectations for a great similarity with the trends and prices from 2012. The main difference from last year is that besides the activity in the real estate, there is highlighted activity on the part of the Bulgarian buyers in big cities - especially in Sofia and Plovdiv. These are the buyers who have waited too long for the purchase of their first home and consider that the time has now come.

Over the past 3 months the apartments in Sofia had sold for the average price of 62 300 euro (63 500 euro for 2012 and 61 500 euro for 2011). The average prices of purchased apartments have not changed substantially over the past 2 years. The trend of search for apartments for up to 50 000 euro, which we observe in the last 2 years, also retained, as there is some activation of the search for bigger and spacious apartments and from there and the rising demand for property in the price range from 70 000 to 100 000 euro.

The real estate market in the two largest resorts Sunny beach and Bansko - more than a year are moving with quite different dynamics. In the area of Sunny beach has seen a recovery in the market and increased number of sales. In Bansko and the other ski resorts the interest during the last winter season continue to be weak. This led to a further decline in the prices of ski properties. The marine resorts definitely import market optimism and are currently the most active segment of the market.

Sunny Beach and the region can be claimed that confidently are walking down the road to recovery. The average price of the apartments in Sunny beach for the first quarter of the year was 512 euro per sq.m compared to 440 euro for the same period in 2012.

The average price of the apartments in Bansko for the first quarter of 2013, was 382 euro per sq.m, which is almost the minimum of the offered prices, that mean the buyers buy the cheapest possible properties. In Borovets during the first quarter of the year the average price was around 600 euro per sq.m., and in Pamporovo - 450 euro/sq.m. Generally speaking, the 2012/2013 season ended with 50 to 100 euro per sq.m lower prices compared to the previous winter season (2011/2012).

The average price of the purchased rural houses, were at much lower levels than those in last year. The activity is quite larger, compared to the first quarter of 2012. Then the average quarterly prices of rural houses were moving around 17 000 - 20 000 euro, while in the first quarter of 2013 the rural houses were purchased with an average price of 10 580 euro (close to the levels from 2009). The greatest interest in rural houses was observed to the region of Stara Zagora and Plovdiv. Also Veliko Tarnovo regained interest in the recent months after a low tide of interest in 2012. Cheap houses for up to 5 000 euro are bought in the regions of Vratsa, Pleven, Vidin and Montana.

The expectations for this year remained unchanged compared to the forecast at the end of last year. In urban property demand will continue to be dominated by Bulgarian buyers. It will depend on the recovery of the economy, unemployment, household income, and access to bank credit. On the basis of those factors, we cannot expect to be substantial change in trends this year. The prices will hold around the levels from 2012. The interest on the part of Russian buyers will be maintained and will continue to grow in 2013, which will bring the market optimism.