After several years of crisis, the real estate market is reviving against a backdrop of historically low interest rates on loans and rising earnings over the years of the boom in deals. According to some market participants, first signs of a property bubble are seen, according to others the situation is far from that. Buyers today are much more demanding on the quality of construction and are not willing to buy at any price. In the larger markets - mainly Sofia and the larger regional cities - the largest supply is not expected to be brand new and meets these quality requirements for construction.
Despite the experience of the years of a very active market and the many building permits issued, the regulations still create many problems for homeowners and the vision of the municipalities for a long horizon does not actually exist. Market property data is something that everybody is trying to create on the basis of fragmented data from several institutions and their own experience. We will present in a brief series a picture of the housing market from the point of view of specialists and builders, the official data, as well as the problems that hamper the market. We will go back and over to understand how homes and neighborhoods have changed over the years.
According to analysts, after the resurgence that emerged last year, there is "a certain retreat" in the first quarter, judging by the number of transactions. The decline is not particularly great, but it is mostly seen in large regional cities. That is, where the real estate market is actually developed. In his view, however, it can certainly be said that the housing market is the most active for the past three years. According to the agency, which has offices in most major cities, about 80% of buyers are looking for a home in which to live, and the rest - for an investment.
According to him, people who have been planning to buy a home for years have come out of the market but high prices since 2008 have pushed them back and now they have decided to buy when they have dropped to "reasonable market levels."
According to the agencies, these observations apply to Sofia, Varna, Bourgas, Stara Zagora, Plovdiv and Ruse to some extent. Unexpectedly for realtors is a very active market in Plovdiv, probably due to the development of logistics centers in the region and the flow of active people there. The city is remarkable with another - there, in practice, the construction activity has not killed the years of the crisis.
According to the agencies, revival is the exact word that defines the market at the moment. In the years of the boom, the deals were 45 thousand a year, while now 25 thousand for the largest market - Sofia.
Analysts say the first quarter of this year saw a slight decline in transactions a year earlier - by about 3%, which he considered as an insignificant issue of market fluctuation. But the truth is that there is no serious growth, measured by the two figures we used to be before the crisis.
Now we are above zero and go up. Unfortunately, I have the feeling that a balloon is blowing, which can crack. For there to be development, there must be a lasting development of the economy, people have high incomes to afford to pay for housing.
At the time of the boom in 2004, the ambition was to buy a cheaper home to resell more expensive after Bulgaria's entry into the EU, with 80% of the buyers of apartments in new residential buildings being foreigners. While the new developments are now mainly bought by Bulgarians.
According to experts, if the number of housing deals is being looked at, the situation is far from a boom - at present it is below 50% of the levels registered in 2008. But prices in some places already exceed those of the previous market rise. The reason for the smaller volumes is the lack of supply and the smaller number of issued new building permits.
Indeed, in the last seven to eight months, the housing market is on the rise. The number of transactions has increased, the interest in buying a home is a fact. Perhaps stagnation, uncertainty, and declining supply over the years are one of the reasons for market slippage. The second major reason - under favorable lending conditions, investment in housing has the best return on savings, he added.
The assessment is that there is not a large supply deficit for new quality housing, but rather, it seems because there are projects of good locations, good quality and naturally - the interest is increased. Tomorrow you will not be able to buy what you like today.