Situation and trends for the Bulgarian real estate market in 2008 - part 1

Nowadays, the Bulgarian real estate market is in a sufficiently balanced condition. There are a stable interest and demand, and on the other hand sufficient supply on behalf of local and foreign investors to meet this demand. The price increase is moderate, without sharp jumps, as the indications show about 50% annually; in other words except well-balanced, the real estate market is in a stable growth period. The sudden price jumps, the stagnation, the lack of new construction and the lack of demand remain in the times past. As a matter of fact, the demand has always been there, but it used to be either avalanche-like or it was turning into a small flow and therefore usually the buyers could not find that what they were looking for. Things are different now. There are many sites, available in varied price ranges, at different distance from the sea, which in itself influences the prices. On the market the sites differ by their area and planning. To a great extent the variety refers to the apartments and the apartment complexes. The private houses are also widely represented on the market, however, the difference in the house demand compared to the apartment demand, is that no foreigner would buy an old-construction apartment, but the demand of old houses is as stable as the demand of new houses.
Of great interest are the areas located within close proximity of the sea - in Bulgaria the length of the coastline is approximately 240 km. The resource is vast; a lot of the attractive plots with a varied-size area, available especially in such regions, are suitable not only for high-rise construction, but also for building of private houses and villas with a magnificent sea view and scenery.
Land properties are wanted as in the vicinities of the large seaside cities, such as Varna and Burgas, as in the area of the summer sea resorts, such as Golden Sands, Albena, St. Constantine and Elena, Sunny Beach. As a general rule, the most preferred ones are the localities where the infrastructure is already developed.
Here is an interesting fact: if earlier the resort apartments were mostly bought for the purpose of seasonal living, thus more often now, the owners stay living in Bulgaria all year round, go on sight-seeing journeys all over the country, including to the uppermost west regions, to enjoy the natural resources and the variety of resorts. The customer service enhancement in the apartment complexes and the resorts in the country has proven its positive effect on the buyers’ choice. All sites are provided with all-year-round maintenance and security guarding, restaurants and shops, indoor and outdoor swimming pools, gyms, bars, etc. Also very perceivable is the construction quality improvement, all the more that Bulgaria joined the European Union and it does its utmost to build as good as the rest of the European countries. For instance, there are more often sites with autonomous or central systems for heating and cooling of the interior premises. Due to the mass and progressively increasing competition in the sphere of construction, the building companies are frequently urged to bring in their tough business progressive technologies, materials, engineering systems and facilities, in order to ensure better habitability standards for the residential sites and to innovatively bring to life the latest scientific and technological achievements in the field of construction, production of building materials, and last but not least, to befittingly make use of the marketing and advertising art. Also a significant trump for them is the necessity of supply of such sites on the real estate market in the same price range as of the sites not particularly innovative as regards finishing.
An example could be the sites that are being built in the quite popular residential area in Varna, called Breeze. Both buildings – with high quality interior and exterior finish, where the apartments are of the same price range, but in one of the sites every apartment is planned to be equipped with the newest autonomous system for heating and cooling of the premises by Daikin, a Japanese manufacturer, and in the second building – the apartments will be heated by regular converter air-conditioners, that is to say the market prices of the apartments are the same, but the level of their technical equipment is different. There are many examples as this one.
If we give consideration to the sites that enjoy the highest popularity among newly arrived buyers, the leading positions are taken by those complexes and small apartment buildings, which are located in the prestigious panoramic areas of Varna – Bulgaria’s sea capital, in regions such as Breeze, St. Constantine and Elena (sea & spa resort in the vicinities of the city), Primorski Park, Galata. The apartments in these areas are suitable as for a seasonal summer vacation, as for all year round living and business. Moreover, there still is a quite good demand for not too expensive complexes in the small resort towns, such as Kranevo, Byala, Nessebar – with pure nature and moderate resort activity. The rise in popularity of the big summer resorts, such as Albena, Golden Sands, St. Constantine and Elena, Sunny Beach - famous across Europe – and the apartment complexes located on their territory continues, all the more that the customer service standard in the country’s resorts gets continuously improved and gradually meets the requirements for a European-level service.