Sofia Property Undervalued or Is It?

Views on BG | September 18, 2010, Saturday // 10:25
Bulgaria: Sofia Property Undervalued or Is It? Photo by BGNES

Property Abroad

Property in Bulgaria capital Sofia is the third most undervalued of those countries Global Property Guide has compiled data for.

According to the data the average price of Sofia property is 1,759EUR per square meter, compared to Monaco at 35,658EUR per sqm, and London, Paris and Moscow at between 10,000 and 14,000 EUR per sqm, but even comparing it to Vilnius in Lithuania at 2,406EUR per sqm, and Bucharest, Romania at 3,404EUR per sqm you can see that Bulgaria property is undervalued.

We all know that Bulgarian property is among the cheapest in the world, with new build apartments available from as little as ?10,000. However, most of the offers we see in the overseas property world have always tended to be off plan and there is always a substantial discount given to factor in a perceived risk of buying a property that only exists on paper -- especially in an emerging market like Bulgaria. So this now shows that residential property is not only cheap but undervalued.

But before you swoop in to bag bargain Bulgarian properties and capitalise on the situation we need to address two things. One, the Bulgarian economy is still suffering massively because of the financial crisis and two -- the biggest -- oversupply:

Before the financial crisis became a reality a severe oversupply problem had become apparent in the popular Bulgarian regions. Foreigners realised their investments were not yielding what they hoped and there was what can only be called a mass exodus. I remember researching the market at the time and finding pages and pages and pages of similar apartments at similar prices in the same set of places.

You are taking a gamble on demand here. However, as the years pass the oversupply problem will die out and there should be some solid growth.

We need your support so Novinite.com can keep delivering news and information about Bulgaria! Thank you!

Views on BG » Be a reporter: Write and send your article
Tags: sofia, real estate, property

Advertisement
Advertisement
Bulgaria news Novinite.com (Sofia News Agency - www.sofianewsagency.com) is unique with being a real time news provider in English that informs its readers about the latest Bulgarian news. The editorial staff also publishes a daily online newspaper "Sofia Morning News." Novinite.com (Sofia News Agency - www.sofianewsagency.com) and Sofia Morning News publish the latest economic, political and cultural news that take place in Bulgaria. Foreign media analysis on Bulgaria and World News in Brief are also part of the web site and the online newspaper. News Bulgaria