Investing on property market in Bulgaria

1. A DOZEN REASONS WHY TO INVEST IN BULGARIA

• Political & Economic
• Property Investment Market
• Tourism

2. INVESTING IN LAND ON BULGARIAN PROPERTY MARKET

• Bulgarian property market - an investment hotspot
• Increasing capital gain by investing in land

A DOZEN REASONS WHY TO INVEST IN BULGARIA

Political & Economic

• Bulgaria is an associate member of EU and will become a full member in 2007
• The country has been a member of NATO since 2 April 2004
• The Bulgarian Economy is growing steadily. Strong growth in industrial production, employment and credit has resulted in a sustained GDP growth of 4.7%- 4.9% over the last few years. The growth in the Bulgarian economy should underpin a strong property market and lead to increased property prices in Bulgaria
• Low Currency risk. The Lev has been pegged to the Euro since its introduction at a fixed rate equivalent to 1 EUR to 1.9558 BGN (Bulgarian currency is Lev).
• The current cost of domestic borrowing is relatively high. The rate that ordinary Bulgarians pay for a floating rate mortgage is in the range of 10 – 12% pa. We believe that once Bulgaria joins the EU, interest rates should fall in order to harmonize with rates in the Euro zone. Lower interest rates should help stimulate the Bulgarian property market.

Property Investment Market

• Property prices have risen in 2004 on average by 40% and Bulgaria still has some of the lowest property prices in the whole of Europe. Property in the most popular residential areas of Sofia sells for around 1,000 – 1,200 EUR/per sq.m (roughly £67 – £82 per square foot). It is clear that in Bulgaria properties are significantly cheaper compared to many other countries in the immediate area. By way of comparison, in London, property in a number of residential areas (such as Knightsbridge, Kensington and Chelsea) can sell for approximately 16,000 EUR/per sq.m (£1,000 per square foot).
• The rental Market in Bulgaria offers excellent return. Rental yields on residential property are currently in the range up to 10% pa of the purchase cost.
• Good quality modern properties command a premium in the letting market. It is currently possible to achieve high rental returns on property depending on the property location, type etc.
• Projection of up to 100% returns in capital growth in the next four years.

Tourism

• Last year over 4 million tourists visited Bulgaria.
• Major tour operators, i.e. Thompson etc are now offering packages for the Black Sea Coast and ski-resorts in Bulgarian mountains Rila, Pirin and Rhodopes.
• You can fly to Bulgarian International airports Sofia, Varna and Burgas from almost every airport in the UK. The Black Sea Coast is only 3.5 hours by air from the UK. All major European airlines such British Airways, Lufthansa, Alitalia, Austrian Airlines, Bulgaria Air have daily scheduled flights to Bulgaria. Hungarian budget airlines WhizzAir have already launched flights to Sofia. Many budget carriers are due to enter the market soon.

INVESTING IN LAND ON BULGARIAN PROPERTY MARKET

Bulgarian property market - an investment hotspot

The Bulgarian property market is the current investment hotspot and offers countless opportunities to any open-minded investor. According to the recent report released by the European Bank for Development and Reconstruction, property prices in Bulgaria have increased by 145% in the last two years.

Most investors so far have been attracted by the extraordinary capital returns. The very low base from which the market started its development and the continuously increasing demand from investors from Britain, Ireland, Germany, the Netherlands, Scandinavia and Russia caused some disparities to appear on the market – these provide some exciting new prospects to those clever and open-minded investors who can spot the opportunity.

Increasing capital gain by investing in land

The vast majority of investors have focused on the market of newly completed or off-plan properties. In result the demand for such properties pushed up their prices in relation to other investment options, such as building plots.

Our main strategy is to help our customers to find investment options with highest potential for future capital gains increase. In this way their returns will be affected by both the capital appreciation of the land over time and from its development.

We could also assist you with your application to transfer and register agricultural land as a regulated one. The process takes about 9 months, yet it could save up to 40% from your investment. All planning stages could be completed even before the planning permission is obtained by the local authorities. We are involved in many similar projects at the moment.

The average return on capital for our clients is estimated at 58% per year, yet in some cases the projections show a return on investment of 140% per year. We achieved these results by choosing the plots of land with potential higher than the average one, with clever and careful planning and professional building development. Good connections with the local and central authorities help us to obtain the necessary licenses and permissions within reasonable time.

Using our experienced team of architects, planners and builders we can undertake even the most difficult and complex projects. Even if our forces may prove to be insufficient, we can rely on a broad network of close property development companies with varied specialization. Our aim is to maximize your profits – your success is a measure of our success!

Thank you for spending time reading the text above. Hopefully it would help you to look at the Bulgarian investment opportunities in a different light and understand the particularities of the Bulgarian property market in a broader way. If you have any questions regarding the issues raised above please do not hesitate to contact us.