Bulgaria - Kavarna - Buying from plans

C

corrcullen

Guest
Am buying a 2 bed appartment in Kavarna, Bulgaria, off the plans, for 65K.
Dealing with an Irish property developer.
Have to pay 12K this week in deposit and the balance this time next year.
Am buying this as an investment only, am hoping that in 3-5 years the property value will have risen greatly.
Is this a good investment?
Any thoughts/advice would be appreciated.
 
Buying north of varna (e.g. kavarna) is generally a much better area of investment than buying then in the concrete jungle of Sunny Beach. The big advantage of Kavarna is that there are 3 golf courses within 30 minutes drive from your apartment and they are also building a port close by.

Location is key, some parts of Kavarna are not great so you have to travel over and check out the location. Under no circumstances should be hand over the 12,000 without first travelling over...

An Irish Developer is an Irish Investor using a bulgarian building company. One key thing is to check what this Irish Developer has built in Ireland or abroad. If this is the first building project in Bulgaria be very careful.

For location ideally you need to be within 100 metres from the beach and make sure that there is direct access from the apartment to the beach. A lot of people say 100 metres and it's actually 200 metres but it's much more if you have to walk to the beach!

In Kavarna the max you should be paying is 800 to 1000 euro per square metre and this depends on finishing. The better the finishing the better the price. If there's a rental agreement in place check to see what tour operator is managing the rentals. I reckon that 90% of guaranteed rentals in bulgaria are just factored into prices. This is really because there is no structured rental systems in place at the moment, this will develop over time.

I bought an apartment in Alen Mak which is about 10 miles from Varna and bought a plot of land which is about 10 kilometres past Kavarna so I do believe the from Varna up as far as the Shabla (close to Romanian border) is a good area for investment.

If you want an opinion on the actual development pm me and I'll try and find out some info.

Also one last thing make sure to negotiate the price. If they are selling for 65k they have factored in at least 10% commission for agents so if they are selling direct you should get a good discount. If you are buying through an agent they can still afford to give you a discount. Ring them up and tell them the max you can get is 60k and you'll see they will drop their price.
 
corrcullen said:
Is this a good investment?
Click to expand...
What sort of assessment of the viability/advisability of this investment have you done yourself already so we don't rehash anything that's old hat to you? For example what figures have you crunched and how? Given that you are seemingly ready to pay a €12K deposit this week presumably you are veering towards it being right for you? If so why?
 

Considering you are going to buy at the "Paddy price" ie 20% to 30% above what the locals will pay, you probably will need to consider moving your investment horizon to 5 -10 years.

Don't believe what developers/agents etc say about prices going up x % annually. When Investors begin to sell new build properties from Eastern European markets with profit after tax then I'll start believing the property price statistics.
 
Don't forget you also have to pay tax on rental income in ireland as well as bulgaria. When you sell you have to pay CGT in bulgaria and in ireland. In both cases you can offset any tax paid in bulgaria against tax due in ireland
 
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