Financial expert Kamen Kolchev has advised against investing in real estate, warning that property prices in Bulgaria could drop by up to 20% upon the country’s entry into the eurozone, whenever that may happen. On BNR, he pointed out that while Bulgarians have a strong preference for buying property, the limited development of financial instruments in the domestic market and a general lack of investment knowledge often leave people with only two options—bank deposits or real estate.

Kolchev explained that while real estate can be a solid investment, it is primarily a long-term commitment. He noted that when individuals need quick access to funds, selling property can be both a slow and costly process. He emphasized that property investments should only be a part of an overall financial strategy rather than the sole means of securing wealth.

According to him, the Ministry of Finance has failed to provide adequate investment opportunities for citizens, particularly in government securities, and has also neglected financial education. He stressed that financial literacy should be introduced from an early age, as schools do not currently teach children how to earn, manage, or grow money. He attributed this gap in financial education to lingering attitudes from Bulgaria’s socialist past, where topics related to investment were largely disregarded.

Kolchev further argued that Bulgaria’s weak investment culture stems from the lack of a functioning capital market. He pointed to Romania and Poland as examples of countries that took proactive steps to attract investors following the financial crisis of 2011-2012. By listing portions of key state-owned enterprises, such as those in the energy and transport sectors, these countries not only generated billions in revenue for their state budgets but also encouraged large investors to enter their economies. This, in turn, boosted interest in smaller private companies. In Bulgaria, however, he noted that the absence of similar efforts has left businesses struggling to secure investment.

Source: BNR