Housing Prices in Sofia Froze, Growth of New Construction Purchases
Housing prices in Sofia have frozen. According to information from Bulgarian Properties during the first three months, the average price in the capital is € 1,080 sq. M, compared to € 1,085 sq. M in the last quarter of 2018.
"This is a slight retreat against the 2018 values, but should be interpreted as a retention of levels, as it is mainly due to a change in the characteristics of the purchased properties, the large share of new construction and the redirection of interest to areas with lower prices, "the agency said.
For the first quarter the average final purchase price of the dwellings in Sofia is € 90,960 at around € 91,550 on average for 2018
Price rises peaked at the end of 2017 and early 2018, and in the spring of last year we saw that buyers stepped back and took a wait-and-see position. This led to a dampening of price rises and the year ended with growth below expectations - only 4% on an annual basis, pointing out.
The agency predicts that 2019 will bring long-awaited market equilibrium through a balance between supply and demand while maintaining stable property prices.
Bulgarian Properties also reported an increase in sales. Some days ago, the Registry Agency recorded 5,641 real estate sales for the three months since the end of the year at 5,631 for the same period in 2018, which is only 10 transactions per year.
Bulgarian Properties, which specializes in sales of new-build properties, claim that the real volume is far greater - and is growing significantly.
The data of the Registry Agency does not include the purchased new-built dwellings, which will be entered as sales upon their completion. According to Bulgarian Properties, "in previous periods, new construction accounted for 60-70% of the deals, and now it reaches 90%."
New building permits issued in Sofia increased by 26% in 2018 on an annual basis. It is the increased supply of new construction that brought balance to the market and softened prices as it managed to meet the increased demand they felt from there.
Half of the purchased apartments are two-bedroom apartments and 42% are two-bedroom apartments. Unlike in previous quarters, in early 2019 we have seen a significant increase in the share of purchased three-room apartments at the expense of a reduction in the two-storey property, which previously reached 65% of the total volume of transactions.
"We attribute this to the activity of families who are looking for a new home for their own use, stimulated by the available supply, as well as by the possibilities of buying with credit even in new-build buildings", say Bulgarian Properties.
The average area of the purchased dwellings is 89 sq.m. - a growth of about 10 sq.m. compared to the last months of 2018, precisely because of the increased share of three-room apartments.
"Within the framework of our expectations, the growth in property prices in Sofia has subsided and we are entering a period of retention at stable levels with slight fluctuations - a plateau in which we will stay in the next 1-2 years", commented Polina Stoykova, executive director of Bulgarian Properties .
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