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Holiday homes in Bulgaria are getting cheaper

The main buyers on the market are the Bulgarian buyers, the interest of the Russians is preserved and that of the Ukrainians has increased.
Property prices in holiday complexes in Bulgaria are not rising or even going in the opposite direction of the common market, Irena Perfanova, chairman of the National Real Estate Association, commented in an interview with BTA.
We report a rise in house prices on average in the country, but there are even declines or retention in the holiday areas, and the main buyer of such properties are Bulgarians, added Perfanova.

Asian buyers like to invest in spa resorts
The interest in such holiday properties by Russians is increasing, the number of Ukrainian citizens is increasing, the cases of buyers from the UK, Ireland, Greece, as well as investors from Western Europe are rarer. The spa resorts in Europe are already interested in buyers from Asia, mainly from China.

However, Bulgarians are the main engine of this market in Bulgaria. One of the reasons for the growth of interest in buying a second holiday home from our countrymen is the possibility of renting it. Buyers are not discouraged by the fact that, because of the seasonal employment of such housing, the yield will be less than half that of the cities, where it reaches 4-5 per cent. This is because even if yield below 3 per cent is higher than virtually zero interest rates on deposits, Irena Perfanova commented.
The expert advises, however, before making such an investment, calculate the expected average annual income and deduct maintenance and tax costs to have the real value of the return.
There is another category of foreign buyers who invest smaller sums in holiday properties through registered companies and then through these companies they are doing business in Bulgaria, benefiting from favorable taxation, which is in fact the main reason for their investment, Said Perfanova.

There are already "nomads" - owners of a second home
Another reason for clients who invest in their second home is the opportunity to "escape" from the busy daily life for longer and whenever they want, said Perfanova. They use the properties they bought for private purposes. "Nomads" - second-home owners who sell their old holiday home over a period of time to change the destination they have filled with a new and perhaps more attractive location, said the expert.

The popular destination for the second home - Bansko, has been reviving the market over the past few months, with an increase in the number of deals for smaller and cheaper properties, as well as apartments and houses in closed and well-run complexes. In mountain and seaside resorts, homes up to 15,000 - 25,000 euros are often sought, but buyers who have additional funds generally tend to spend up to 40,000 euros, given that in larger cities with This money very hard to make a good investment, the expert noted.

Buying a second home in a closed complex must be accompanied by a good preliminary check of how it is managed, whether the company has any problems, is the collection of management fees and what is the size, the expert advises.
It is imperative to always take into account the additional costs that we have to foresee for the management of the total areas in the closed complex on an annual basis. Taxes are usually formed on the basis of the quadrature of the property together with the common parts, the average being usually between 0.50 and 1.50 EUR per square meter per month. The amount does not include the cost of internal maintenance of the property, which means that if we decide to assign our property from within, we also have to calculate the fees that are deducted from the rent, ie. Of the generated rent, the expert commented.

Perfanova warned that the provisions of the second home's internal management contracts should be closely monitored, with severe penalties or penalties for failing to do so, or abuse of owners' confidence - for example, in concealing short-term rent payments . It is also possible for the owner to control the use of his property by himself when he systematically detects the use of consumable costs in the dwelling or other means. However, this does not guarantee that possible misappropriation of the transfer will be interrupted, the expert noted.

That's why the expert recommends turning to companies with a proven track record in renting and managing real estate that they keep in their name and somehow that will ensure that they will not generate revenue without telling us. A good option is when the real estate company has the practice of guaranteeing a minimum return.