2013: prognosis for the Sofia apartments market
The analyses of leading bank institutions and the National Statistics Institute in Bulgaria, which were made at the end of last year, showed that for a period as short as four years, the Sofia apartments have become twice more affordable. This is not a result of a miracle, rather a result from decrease in the interest rates applied on mortgages and the stable income of the people, who still have jobs. Based on all that, it was estimated that the period required for paying off of a one- or two-bedroom Sofia apartment by one family is three years and a half opposed to a period of seven years before the global financial crises. The prognosis for year 2013 is that affordability of the Sofia apartments to remain the same. As a result of the decrease in the mortgages interest levels, the number of the Sofia property deals and mortgages is increasing. That increase is not as fast as before the crises, but it shows that there is interest in the Sofia apartments and that it results in more and more new sales. Even so, the sales of Sofia apartments are not to the level that the real estate agents or the banks would like them to be. The reasons for that are the high percentage of unemployment and the level of uncertainness and insecurity in people. We should also mention the reduced number of foreign citizens that invest in the capital of Bulgaria. Yes, there are many new investors who buy one and two bedroom apartments in Sofia with the aim to rent them on a hotel basis and they make a good income from that. However, their number is not that serious as it was several years ago.
The good news here is that after a period of three or four years of careful attitude and waiting nowadays the families who are looking for a new home and the foreign investors who have stable income have already accepted the market situation and are planning to go and buy Sofia apartments according to their needs and requirements. Currently, the prices of the new apartments in Sofia city vary in the price range 650 – 900 Euro/sq.m. The most sought after remain the one-bedroom Sofia apartments, which are part of new complexes and are located in good residential areas. People who are looking for such Sofia properties are usually young families with one kid and professionals who have managed to save a certain amount of money. These people are willing to take mortgage and usually the salary of one of the partners is used to cover that mortgage and the other bills, while the salary of the other partner is used to cover other expenses that occur. Buyers of Sofia apartments require their new homes to have good layout, to be set in well-arranged complexes with security if possible and to be part of neighborhoods with good reputation, low levels of crime, many facilities and an excellent infrastructure.