An increasing number of banks are registering or considering setting up their own real estate agencies, Bulgarian-language Dnevnik reported on July 19.
In this way they provide all services related to property purchase, from the choice of a property to the signing of the agreement.
It seems as if these banks’ agencies are serious competition to established real estate agents because with property purchases or mortgage loans, several offer preferences otherwise not accessible to other agents.
However, non-bank real estate brokers are not worried about their business. Aristo property company owner Tihomir Tsakov said that there had been no considerable impact since the appearance of Raiffeisenbank Residential Centre (RRC), for example.
“I don’t think that the new companies can take a serious share,” said AG Capital president Hristo Iliev. His firm did a survey on world experience on the question after RRC registration. It showed that this type of business was typical for German-speaking countries but it was limited to a certain amount of deals. Iliev said that in UK the same scheme has been tried unsuccessfully twice, and similar cases had been seen in Italy and France.
Banks that have already registered real estate companies include Postbank, Bulgarian-American Credit Bank (BACB), Piraeus Bank, UniCredit Bulbank and Raiffeisenbank, and few other financial institutions are considering setting up their own property agencies.
Among the services the bank companies offer are property choice and financing, as well as legal consultations, insurance and property leasing, as well as special products for foreigners or Bulgarians living abroad.
These real estate agencies are the next step of the banks towards this attractive market, after the registration of Companies with Special Investment Purpose (CSIP) for properties by the Central Cooperative Bank, BACB, Corporate Commercial Bank and others.
“Through their real estate companies, some of the banks currently invest their own or their clients’ money in business projects. In this way, both the bank and the client win,” said Source Real Estate managing partner Krassimir Dimitrov.
The specialist company set up by Postbank and DZI Bank owner Greece’s Eurobank EFG, EFG Properties Services Sofia (EFGPSS), has been on the market since 2005. EFGPSS is expected to expand the group’s market presence and to support Postbank in property assessments and in developing its branch network, the company said. According to EFGPSS, it already had deals worth more than 10 million leva and its next goal was to offer property consultancy and management services.
Bulfina owner Piraeus bank is considering expanding its activities as well.
