The global crisis in 2008, has turned many things upside down in Europe. Everyday life has given us a new “agenda” in the media with headlines such as Ball aut, bankruptcies, rising unemployment rate ……
The crisis which started in autum in 2008, has also affected the marked for buying and selling holiday homes in Bulgaria.
The housing market before the crisis
After the millennium, it became possible for foreigners to buy property in Bulgaria. It was mainly people from England and Ireland who discovered the new market, followed by customers from Denmark, Norway, Belgium and Poland. It was not uncommon to buy one apartment or more off- plan, and to pay the purchase price in installments as the building was built.
The housing market after the crisis
In 2006 and 2007 it was also interesting for people from Russia and the Russian-speaking republics (with a population of approx. 250 million, of which approx. 150 million live in Russia), to buy second homes on the Black Sea.
The demand from the Russians to buy apartments in Bulgaria, increased significantly as the global crisis did not affect the Russian economy significantly. It was now possible for the Russian middle class to buy on the resale market, where the prices began to drop with 10 to 20% in value per year.
The Russians do not buy as an investment
Most of the people from western Europ bought holiday homes as an investment with the expectation for:
- Rising housing prices after Bulgaria joined the EU in 2007
- Rising housing prices with the replacement of the Bulgarian leva with euro
- Recouping the investment in rental
The majority of Russians do not buy property as an investment, but to use the property. They are attracted to:
- The hot summers and the fresh air from the Black Sea
- The fresh vegetables and fruits
- The lack of language barrier- almost all Bulgarians speak Russian
Today, 9 out of 10 apartments are bought by Russians. According to the latest statictics around 110.000 Russians are property owners in Bulgaria.