Maltese Warned Not to Buy Property in Bulgaria

Business | June 20, 2007, Wednesday // 00:00| Views: | Comments: 10

Maltese real estate advisors have warned property investors that Bulgaria's market is saturated and prices are expected to start decreasing as soon as the property bubble bursts, Malta Star newspaper reported.

The main problem with Bulgaria is that everyone is building even without permission from Bulgaria's permit authority, the article says. It cites statistics according to which around 25 per cent of all property in Bulgaria is actually built without permit.

Bulgaria has also been criticised for focusing on the development of property at the expense of infrastructure projects, such as those for transportation.

"When buying in another country, most people never do much more research than what is given to them from the investment company. This is a dangerous habit. Everyone between the potential buyer and the property is just a salesperson, and they all get paid on making sales," said Alyona Frendo a local international property advisor.

Foreign citizens and companies have spent a total of EUR 310 M in acquiring real estate in Bulgaria during the first three months of 2007.
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» To the forumComments (10)
#10
Kolega - 18 Aug 2007 // 19:07:10

Anglichanina:
"does that mean at a level where virtually all potential Bulgarian first time buyers are priced out of the market. "

That's pretty ridiculous.
"Bulgarian first time buyers"?

Look, BG has no "first time buyers" in the Western sense. Due to our catastrophic birth rate and exodus, most young people, far for looking for a place to nest (another thing they don't do), usually have more than one apartments at their disposal, being the only child for two sets of grandparents, also considering the notorious BG obsession of providing a place to live for your offsprings.

The prices are driven up by newly rich Bulgarians, like many of my friends, who have apartments all over the city, and the foreign investors. And thank God.
British interest in our Real Estate, far from pricing Bulgarians out of the market, actually serves as a source for cash for many new businesses, where new jobs and wealth is being created as we speak.

#9
resipsaloquitur - 18 Aug 2007 // 14:04:18

Dear Mike Larts,

it is good you do not work for Coldwel&Bankers..it does not matter...

Anyway if you know someone who is interested in buying Ramada Inn in Irving,
please he/she should contact my friend,Rick Skogland at CBDFW.

As for Bulgaria...I was in December in Golden Sands(Zlatni Pyasazi) and in my opinion the developers did NOT do sufficient MARKETING RESEARCH.

The trend nowdays is towards AGROTOURISM...most tourists come from big cities and when they travell they want piece and quite environment.

They overbuilt the Bulgarian Sea Coast...no wonder why the hotels are NOT full.

Beside this there is a recession in Western Europe.

I live in Berlin,Germany...in some parts of the city the majority of the population do NOT have work.

Especially skilled workers can not find jobs as the factories moved to Eastern Europe.
Most products which I buy here come from the new European Union....even the Christmas turkey comes from Poland.

I just returned from Cyprus and they have the same problem there...the big hotels along the sea went bankrott....NO guests...the Europeans either can not afford to travel or they do not want to go to countries where the service is NOT on a high level.

#8
mikelarts - 18 Aug 2007 // 05:52:09

The bottom line, folks, is you home is likely to be the single largest investment most people will make in their lives.
The fact that inflation in the Real Estate market in Bulgaria is driving the prices up makes Bulgarian Real Estate most probably one of the best investments in the country. Even if a person is borrowing the money to buy the home with a 10, 20, or 30 year mortgage at 7.5% interest they will stand to make a profit selling that piece of property after about 5 years...less if they buy in a location which goes up faster in value.
I agree that the wages in Bulgaria need to grow, and Bulgarian markets need to grow. There is no argument here.
My point is simply that the people come first, and that this is a great investment for anyone who is able to do it...and no, not everyone can buy their own home. Not here, and not there. Or anywhere else.
And no, I do not work for Coldwell Banker, and I don't split commissions with anyone, and That allows me to work at a percentage which is more favorable to both the buyer and the seller. After all, The People come first.

#7
resipsaloquitur - 21 Jun 2007 // 17:56:48

Mikelarts means that the real estate in Bulgaria shall be dictated by the laws of "supply and demand" as in every other capitalist country.
If the Bulgarian Government follows the economic theory of Adam Smith,it may intervene in the Property market and changes the Land Laws in such direction that young couples are given lower interst rates and long term mortgages.

The reality is:If the Bulgarians want higher standart acommodations,the consruction industry has to BORROW and borrow and borrow and everybody wants more and more money...Landowners,licensing agencies,construction workers;handykraft people a.s.o.

The result is higher prices for houses and apartments...but,hey,don't worry..
NOW you have freedom!

#6
anglichanina - 21 Jun 2007 // 12:40:01

mikelarts - when you say " as for prices in Bulgaria...they have been depressed for far too long and are just now beginning to reach the levels at which they deserve to be..." does that mean at a level where virtually all potential Bulgarian first time buyers are priced out of the market. Yes indeed, you may well say "God bless Bulgaria and may its prosperity continue for a long time", but surely it's your prosperity that will continue, not Bulgaria's...

#5
Kolega - 20 Jun 2007 // 17:25:07

LAWMECHANT, would you help me with a BRIDGE my father left me?

#4
resipsaloquitur - 20 Jun 2007 // 17:11:40

Dear Mike,

I know that as a real estate agent (especially if you work for Coldwell&Bankers)

you have to share your commission with the company and not so much is left for you.


I would like to ask you:DO YOU KNOW SOMEONE WHO IS INTERESTED TO BUY A

HOTEL ON ESTHER BLVD. (very close to DFW Airport) in Irving?

It is offered for $ 6 000 000,- and my friend Rick Skogland is trying to sell it now for some months.

He has his office in Irving and you could reach him on:

214/662 57 78 or click his web page:www.CBDFW.com/RickSkogland.

He speaks also Spanish as he worked for Global Crossing in Mexico City.

May be you could help him to finally sell this hotel.

He studied at the Trinity University in San Antonio.
I was in your city in 2005.

The RIVER WALK remined me of Sevilla,Spain.

If you wish to contact Rick,tell him that the lady-lawyer from Berlin,Germany
sends you to him.

Thousand thanks !

#3
Mat - 20 Jun 2007 // 16:29:10

lol at mikelarts

#2
Robin - 20 Jun 2007 // 15:48:34

I would say that real estate prices are rather overpriced in Bulgaria if compared to official average earnings (which are anyway rubbish), but if compared to the cost of living, they are actually still quite a good deal. Of course it's hard to know which measure to use to compare. I've just bought a flat here (Plovdiv) which whilst considerably more than I hoped it would be, was still about a 4th of the cost of an equivalent flat in a large city in the UK. I estimate the cost of living in BG to be about a third of that in the UK, so whilst over priced for locals I think the value is still not too bad (but it ain't a bargain, that's for sure).

The real issue is occupancy levels. There are so many empty flats in BG (especially in the newer builds) that if the owners all decide to cash in at the same time the market will crash. I don't think they will as I believe many owners are Bulgarians abroad who want a pad for their summer hols in bulgaria. But I might be wrong.

#1
mikelarts - 20 Jun 2007 // 14:34:59

As a Real Estate salesperson in Texas I take exception to the statement that 'we all get paid on sales' as it makes it sound like we don't care about people. The people come FIRST! And as for prices in Bulgaria...they have been depressed for far too long and are just now beginning to reach the levels at which they deserve to be. God bless Bulgaria and may its prosperity continue for a long time!

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