Sofia investments: budget airlines, growing tourism figures and stable rental market
Sofia apartments that are rented on short-term basis and are set in the central parts of the capital, with good infrastructure and easy access to the entertainment spots are in high demand. This is so because the Bulgarian capital is attracting more and more tourists who are interested to see the cultural sights in the city and are intrigued by the rumors for the exciting night life. Despite the world crisis, as a growing market Sofia is ideal place for investment as it has simple policy towards the foreign investors, affordable property prices and growing demand for rentals from all those tourists and business people visiting the city. According to the statistical data, the number of foreign tourists who have visited the country in the first nine months of year 2008 has increased with one fifth. The same research pointed out Sofia as the European destination of choice.
Being the economic and the cultural hearth of the country, Sofia is attracting the attention of business people and travelers alike. Its airport has registered a growth of 20 % in the number of passengers and presence of two budget airlines to several major European destinations, a positive fact despite of the crisis. In the end of year 2008, one of the low-coast airlines EasyJet added several extra flights to Sofia Airport from UK, to be of help to the second home investors and the tourists who see Sofia as the up and coming city break destination for this year. The rental market in Sofia enjoys a stable growth and increasing interest in contrast to the slow investments in properties. This trend, which was first recorded in the last three months of 2008 is now stabilizing in the first two months of the new year and is determined by the fact that more people are renting apartments rather than buying them. Currently, the Sofia rental market demands studio and one-bedroom apartments. The interest towards the small apartments is increasing because of the global financial crisis. These apartments have affordable rental prices and low maintenance costs, which make them preferable when compared with the rest of the Sofia apartments on the market. The large real estate companies on the market predict that the first three months of the year will see a few deals in the capital, to be followed by stabilization in the middle of the year and balancing between the demand and supply at the end of 2009.
What about the properties sale market? The average prices of the properties that were bought in Sofia in the first three quarters of 2008 have gone up with almost 19% if compared with the prices of the properties bought a year ago, to suffer a decrease of 20% in the last quarter of 2008. The preferences of the buyers however remain the same and the highest demand is for apartments in the central zone of Sofia, the quarters with good view towards Vitosha Mountain and of course, Lozenets. The prices of Sofia apartments will stabilize and will increase with a slow pace around July, a trend that will be kept until the end of 2009. Actually, year 2009 is considered the best moment for buying a home. The buyers of Sofia apartments are divided into two distinctive parts, local Bulgarian buyers and foreign investors, who have different reasons for purchasing but the same eye for the good properties. At the moment these buyers, without observation of their nationality, are waiting to see in which direction the market will go before making a move. The deals that are closed these days are signed because of the good discount given by the sellers.
Predictions? Because of the market’s situation, interesting possibilities are about to open for the property investors, if they have the funds and are ready to act pragmatically. An investment in a new apartment in the center of Sofia with available funds and no mortgage is considered sensible and justifiable. The experts predict that the property prices will not go up but rather remain at their current levels. At the same time the buyers will become more demanding when this concerns the quality of the apartments they are purchasing, the infrastructure and the location as the market will be in their favor, while the sellers will be more open for making discounts. What are the experts saying? The advices of all property experts are that buyers should invest only in attractive properties that will not only answer to their needs but will also correspond to the stable investment requirements. In other words, the buyers should choose such properties that are ready-made and that will keep and increase their value with time and have good rental potential.
