The market values of the homes should not decrease any more. This is important for the economics as a whole, not that much for the sellers and the banks. The reason is that if the property bought in the period 2006 - 2008 it was valued with 20% less than its current market value, the Banks from on the other hand gave a mortgage with 20% less than the market evaluation so at the end we get 40% decrease of the price for which the mortgage was given. In this way the self participation of the buyers is 40%, so when the depreciation of the properties is too much and eats the percentage of self participation, that becomes a problem for everyone. If the depreciation of Bulgarian properties continues, this could have a bad reflection on the economy in the country.
Another problem which arise for the real estate market in Bulgaria is that the government institution did not learn the lesson from the crisis. The direction in which they should work are 3, the first one is to improve the market information which the government institutions are providing is not good. The fact that we are looking at the number of deals combined with the deals for agricultural land is a big problem in relation to the current condition of the real estate market in Bulgaria.
The second direction in which the government institutions should improve is to control the deals for off plan properties. Lets be clear that when people are buying off plan properties they are giving unsecured loans from a normal citizen to a building company. The third thing is to improve the regulation for the mortgages.