The average price of housing in Sofia, for example, was 78 000 euro, while the nationwide average was 44 000 euro. Among countries covered by the survey, only Turkey’s profile was similar to that in Bulgaria. An apartment in Turkey’s capital Ankara sold for an average 76 000 euro, while the nationwide average price was 66 000 euro.

France was among the countries with the highest average prices, at 325 000 euro in Paris and 205 000 euro countrywide. The Czech Republic was the most expensive among the countries that joined the EU as part of the 2004 enlargement. Average housing prices in the Czech Republic were 67 000 euro for the entire country and 242 000 for Prague.

Over the past five years, Bulgaria saw prices of residential properties rise by 21 per cent on average, ERA Bulgaria country director Teodora Dimitrova said at a news conference on November 18, as quoted by investor.bg. Since the beginning of the year, the 30 per cent residential price growth has been returning to the all-time highs of 37 per cent that was reported in 2005, she said. In 2006, price growth was14.7 per cent. The reasons behind the pricing increase included Bulgaria’s accession to the EU and the high demand for residential housing created by the lack of properties being built in the run-up to EU accession.

In the past five years, average housing prices rose threefold in Sofia and by 2.64 times in the country as a whole. A residential property remained on offer for 40 to 60 days before it was sold, the ERA report said.

In the first three months of this year, the prices of housing in the big cities rose by 25 per cent year-on-year. The prices of old residential properties have remained stable.

In Sofia, in particular, experts reported high demand in all segments. Small units remained the most expensive, the ERA report said. The average rates were 1904.8 leva a sq m but in the whole country, average prices were 1118.8 leva a sq m. The price of housing in the luxury segment rose by 10 per cent year-on-year. ERA explained the phenomenon with the fact that the bulk of buyers were in the medium income segment and use mortgages to finance their purchases.

In two years’ time, Bulgaria’s residential complex will have 12 600 new flats with total area of 1.67 sq km (1.67 million sq m).

ERA ranked Bulgaria sixth in terms of foreign direct investment growth in real estate in the past year. Over the past 12 months, revenues from the sale of residential housing to foreigners reached 1.1 billion euro, a threefold year-on-year increase. It was domestic demand for housing, however, which was seen as the biggest factor to drive developments on the local residential housing market.

The report also saw Bulgaria top of the rankings of households’ ownership of the dwelling they occupied. At present, 94 per cent of Bulgarian households own their flat or house. Among the reasons behind the growth rate were the intense construction in the past few years, easy access to mortgages and competition on the market. By comparison, the percentage of proprietary homes was 64 per cent in Austria, 85 per cent in Cyprus and 69 per cent in the Czech Republic.

Meanwhile, a survey ordered by investor.bg revealed that demand for holiday properties, especially for units in closed-type complexes, was on the decline. In almost all resorts, both winter and coastal, demand was many times lower than supply, which had prompted investors to decrease prices. The trend has also had an impact on pricing of land parcels for construction.

Source: Sofia Echo