In search of low-risk financial instruments and high returns, more investors are turning their attention to buying agricultural land, investment firms say. In recent years landed properties are now viewed as an investment asset rather than simply as a place to produce agricultural produce.
Agricultural land in Bulgaria is characterized by low volatility, high yield at low financial risk and, last but not least, low correlation to traditional classes of investment assets.
Moreover, it is not influenced by political and economic processes, such as, for example, real estate in which recent leaps and falls have been observed.
According to the latest data of the National Statistical Institute, the average price per hectare in Bulgaria is about 761 leva, and for the last six years his value has increased threefold. The rent is an average of 50 leva per hectare. Accounts show that when planning good land purchase, yields can exceed 10%, even if additional investment is needed to develop a plot. This is significantly higher than the return on investment funds.
The purchase of land is increasingly used by Bulgarians living abroad or those with high incomes who have saved money over the years. The acquisition of landed properties is also an excellent opportunity for farmers to consolidate their plots and expand their farms. The consolidation increases productivity and reduces costs and leads to more efficient and modern agriculture. It provides better conditions for mechanized land cultivation, which will allow farmers to apply for a subsidy under different European programs.
Agricultural land can also be bought on payment. There are already companies on the market offering deferred payment of the properties.