There has been outstanding growth in the Bulgarian property market during 2004. The overall property prices growth has reached an average nationwide 30%-40%, with some areas adding over 100% value. The number of property sales has grown 30% compared with 2003. The number of new construction and building permission has also increased with 30% for the first 9 months of 2004. There is also a 10% growth in the number of mortgages issued by banks, reaching €418 million. Along with other investments the property sales transactions have reached €1 billion. Property agencies increased with 12% and illegal property businesses have doubled.
During 2004 highest property prices growth have registered the big cities and holiday resorts. A number of cities and areas have doubled their average property prices. The most expensive cities have been Sofia and Varna. Varna has outperformed Sofia and now the most desirable areas in Varna have reached prices of €1,100 – €1,300/sq.m. The average prices in Varna at the end of 2004 has reached €760/sq.m., whilst in Sofia average prices vary between €600 € – €620/sq.m. and most desirable areas in the capital have reached €1,000 – €1,100/sq.m.
The average prices in Plovdiv, the second biggest city, have reached €400/sq.m. with most desirable areas reaching €550/sq.m. Average prices in Burgas, the southern Black Sea city, have reached €400/sq.m. with most desirable areas reaching €620/sq.m. Eventhough, cheaper than Sofia and Varna, property prices in Burgas and Plovdiv have registered higher growth of about 35% – 40%.
Property prices in the holiday resorts have risen from €600/sq.m. at the end of 2003 to €1,000 – €1,300/sq.m. at the end of 2004. Even the high supply of new developments could not affect this tremendous growth and demand.
Expectations for 2005 is for continued growth. Most expert believe growth in the most expensive areas, like Sofia and Varna, to be more moderate. Plovdiv and Burgas should enjoy another year of strong growth, as well as most smaller regional centers, previously left out of the proeprty market boom. There are numerous signals from the international property investors that Bulgaria will be included in their 2005 projects for industrial and business property investments and therefore, a significant growth is expected in this area of the property market.