Hungarian and Bulgarian property, Why?

Yes I agree. This property crash could actually be the best thing that has happened for places like Bulgaria. It will get rid of many of the fly by night investors and agents. Stop all the hype and over priced sales tactics. And bring things back down to a sensible level. Prices had just got silly - 1500 E/sqm for an apartment in Sunny Beach is ridiculous and the same as prices for apartments in new complexes in cities like Manchester, Liverpool etc. Now prices back to a more sensible level of under 600E/sqm. Some even cheaper. Unfortunately it means many investors will suffer, but we all live and learn.

This all had a knock on effect in the rural areas. Bulgarians saw what British and Irish were prepared to pay for an apartment along the coast or for a renovated house with a pool in the countryside and suddenly they were trying to get 40,000 Euros for their tumbling down property. They never really understood the difference between what an old house with no proper sanitation or kitchen should cost compared to a completely new or renovated village house with all mod cons. A village house was a village house to them - regardless of condition. Now sellers will have to be more realistic in terms of price if they want to sell.

Hi,
I think the property crash may not be a bad thing for Bulgaria too as before the crash the resale market was non existent and people only wanted to buy off plan and it had to be new etc . My own view is for what is worth is it will recover at some stage and people will see a return on their investment but it will depend on location etc for people who bought property up in the mountains it may not come in my lifetime but for investors with frontline apartment and decent apartments, if they wait they will see some return on their investment maybe not as much as they were expecting but at least cover costs etc and hopefully these people can rent until than so again this is only my view and if the so called experts could see this coming they would be counting their money right now and would not have time to comment on this blog.

Personally think it is more likely to be the other way around - there are so many apartments for sale, being built, planned to be built etc and so many horror stories, that I think property in coastal resorts and ski resorts will be less likely to recover than say people who bought apartments in cities and towns, or mountain retreats. There is so much competition for rental in places like Sunny Beach that this is hardly an option either. Where as from my experience if you are not looking for too much, you can rent out village houses (renovated) for long term lets to people looking to move to Bulgaria or just want a change from the UK for a few months. I have two rented out this way and while certainly not a great return on investment, its enough. One is about 11% per annum and the other is 8% per annum.

Hi,

I can not see this happening myself. Sunny Beach I agree was a bubble waiting to burst bad planning poor developments one development on top of each other. But Bulgaria has a lot more to it than Sunny Beach and it will find its feet. I dont think too many people are prepared to live up in the mountains maybe a few but not enough to raise property prices.

Of course, Sunny Beach is not representative of Bulgaria at all. But rural does not have to mean in the middle of nowhere in the mountains. My house is just 20 minutes from Stara Zagora, 15 minutes from Kazanlak and at the base of the mountains but has all amenities close by. Most of my friends live in villages about 20 to 30 minutes from a major town or city. These areas I think will recover better than the resorts as offer quiet, pretty locations but close to everything you need.

Rachelg,

Well best of luck. But if history has anything to go on Location Location always wins out/ frontline coastal properties have always come out on top, but if you are not too worried about this and are concentrating on the local domestic market you may be on a winner. But I don’t see Bulgarians having easily access to ready finance any time soon but again I am no expert and maybe its time to rock common trends.

Location always wins out but while a lovely house close to beach and sea in pretty place would always be worth a decent amount, a tiny studio apartment surrounded by thousands more in an awful noisy, tacky resort, even if front line is not always going to be a good investment.

My target market tends to be British and Irish looking for a rural holiday home or retirement home or younger couples looking to leave the rat race and move abroad. I don't sell to the local domestic market. Bulgarians certainly invest in rural houses for their own holiday homes, for family, for investment etc but they usually go straight to the owner and buy direct as no language barriers and everyone in a village knows everyone else anyway. I would say at least 50% of my former customers now live or spend considerable amount of time in Bulgaria in their houses.

Rural properties in any holiday destination tend to be a more attractive option in many ways for foreign buyers, but this realisation only comes after a few years of living by the beach with the crowds and the lack of tranquility. In general, the vast majority of buyers want seaside property, and the rural alternative (attractive and all as it may be) will never comprise anything but a tiny fraction of the overall market. This is the reality, and investors ignore it at their peril.
Without the over hype of the coastal and ski property market in Bulgaria, it is possible that the rural sector that you promote might have survived in its niche, but the collapse of the mass market has undoubtedly dragged down the rest of the real estate market in Bulgaria.
Bulgarian coastal property had a market niche, selling to Bulgarian, Russian and Ukranian buyers, but it was never going to be able to sustain the business generated in the UK, Ireland, Holland etc in recent years. Pumping up the prices by one to two hundred percent, and further inflating the market with the guaranteed rental scam, created a "perfect storm" that brought down the market and the rural market with it, and it won't recover any time soon.

Hi,

I think Lollix is right but hopefully the costal market will recover sooner rather than later and this may send some people screaming towards the mountains.

Im back!

Ive not posted in over a year!

Just needed to share my joy in the new flat rate 16% income tax plan for 2013. This news alone will encourage investment here if only the Fidez government could get a little more credibility.

Virtually no sign of recovery in USA yet ...... remember UK is at least a year behind USA in the housing price crash.