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Holiday properties - a new investment opportunity on the property market in Bulgaria

Undoubtedly, the Russians were the ones who kept the holiday property market until a few years ago. There was a retreat on their part, which inevitably reflects on the segment. Major investors froze their projects, supply on the secondary market increased, as a result of which the prices slightly returned. But no matter how grim the picture looks, it also has a bright side, an increasing number of investors offer investment properties - those with a guaranteed income of 6-7% on an annual basis. According to experts, 90% of the inquiries that have been received since the beginning of the season are for low budget properties - up to EUR 30,000 and mainly for one-bedroom apartments, which are mostly available on the secondary market.

In recent years the number of Bulgarian buyers has increased considerably. A major role for this is played by banks that have lowered the interest rate on deposits, with most of them under 1%.

At the same time, the interest of foreigners in the purchase of investment properties in Bulgaria has doubled since the end of 2016 and continues to grow in the first half of 2017.

Investing in a holiday home offers a perfect balance between passive income and capital gains in a situation of exceptionally low interest rates on deposits and cheap loans, analysts said. The indications for increasing the interest of foreign tourists to Bulgaria as a summer destination are another reason for the Bulgarians' interest in investing in a real estate on the Black Sea coast with a view to renting them.

The offer of holiday properties will exceed the demand, as the market of residential properties will remain the traditional one for the country. Due to the ongoing economic crisis in Russia and the EU sanctions imposed, Russian tourists will not be the main driver of the holiday property market in 2017. It will move from other foreign tourists, and increasingly from Bulgarians" analysts predict.