Bulgaria's real estate market has seen a notable uptick since the beginning of 2025, with housing prices increasing by approximately 6%. This growth comes amid heightened expectations surrounding the country’s planned accession to the eurozone.

Over the past decade, more than 70% of property deals in Bulgaria have been settled in cash, a trend linked to the sizable informal economy. According to Yordan Yordanov, managing director of a major real estate brokerage, many private sector employees are not fully insured for their actual income. This discrepancy skews official economic indicators and helps explain the prevalence of cash transactions in a country that officially ranks as the EU’s poorest.

Yordanov pointed out that the consistent rise in property values contradicts the notion of widespread poverty. Typically, in poorer economies, home purchases are more dependent on mortgage loans. However, Bulgaria reports one of the lowest levels of housing loan indebtedness in Europe.

The current surge in property prices is also attributed to inflationary pressures, following the 15% increase in the minimum wage implemented on January 1. While this has led to higher overall living costs, the Bulgarian National Bank has taken steps to shield lower-income groups from the full impact of inflation.

In terms of lending activity, Sofia leads the country, with more mortgages issued in the capital compared to cities like Varna and Plovdiv. Yordanov explained that higher property values in Sofia justify greater reliance on mortgage financing. He also emphasized the financial benefits of borrowing, suggesting that taking out a home loan is more advantageous in the current economic climate than using personal savings, due to inflation offsetting interest payments.

Looking ahead, Yordanov expects that Bulgaria’s entry into the eurozone will significantly boost both domestic and foreign interest in the real estate market.