Supply of properties in Bulgaria exceeds demand despite the growth in transactions

Data of the consultancy company ERA indicate that the supply of properties on the market continues to exceed demand, despite the growth in the transactions, which are observed during the first half of the year.

During the first six months of the year, the company reported 23% increase of transactions. Every month at the offices of the company are registered 50-100 new customers who want to purchase a property.

Basically, customers are looking for their first home or want to change their current dwelling with better one. Many of them in the recent years have postponed a deal because of the strong decrease of the prices in anticipation of stabilization.

According to the Agency, the stabilization of prices is already in place. The sharp declines are in the past, and the movements are of the order of 1-3 per cent in a downward direction, the trend will be maintained and in the coming months.

Sudden changes in the property market are not expected, however, in the areas with concentrated enhanced search - for example, the metropolitan district "Mladost" or in areas around subway stations, declines in prices will probably stop and even can be seen a growth.

According to the company, at the end of 2012 is observed slowdown in the pace of decline in prices of sq. m not only in Bulgaria, but in Europe as well. At the end of the last year, the average price of a sq.m living area in Sofia reached 737 euro, to March 2013 has already been 727 euro. For the country, the average price was 447 euro respectively to the end of 2012, and towards the end of March - 443 euro.

The average price of the most sought housing - two and three bedroom apartments, in Sofia is 50-60 thousand euro, for the major cities such as Varna and Bourgas is 35-45 thousand euro.

The property market has seen another trend - reduces the share of attracted resources from credit that buyers finance the deals with housing, although it has seen a slow decline in interest rates. The Agency's data show, that the average interest rate on a mortgage towards the end of last year was 7%, in April was 6.9%. The practice of buyers lately, however, is to sell other inherited properties and with the money to fund the new deal. If it comes to credit, buyers strive to not more than 50% of the price of the transaction.