Apartments in Sofia Become Less Affordable

The average monthly salary in Bulgaria amounted to around 340 leva in 2006, official statistical data shows. The average salary in Sofia, however, was considerably higher and stood at around 510 leva, or 260 euros.The average price of the residential properties in Sofia stood at around 500 euros per sq. m in the third quarter of 2006, which means that the price of a 65-sq. m two-bedroom apartment came to around 32,500 euros.A Sofianite with an average salary of around 500 leva could buy the apartment for 125 months, without making any other expenses in the period.The average price of residential properties in Sofia stood at 1,262 sq. m in the third quarter of 2008, while the average monthly salary in the country stood at 523 leva, data of the National Statistical Institute show. The average monthly salary in Sofia stands at around 784.5 leva, or 400 euros.This means that an average salary would buy the same 65-sq. m apartment for 205 months, which proves that the residential properties in Sofia have definitely become less affordable.The main reason is the faster residential property price growth compared to the salary growth, which may be put down to the banks which banks eased the lending requirements during their credit expansion. Bulgaria ranked second in the world in 2007 in terms of fastest growing residential property prices (34%).