PROPERTY AGENCIES IN BULGARIA EXPECT PRICE DECREASE

09:27 Fri 12 May 2006

Real estate agents in Bulgaria expect a price decrease once mortgage apartments are offered for sale.

Prices might decrease by as much as 20 per cent, Darik Radio reported.

National Real Property Association (NRPA) head Orlin Vladikov said the highest number of apartments in 2005 was sold in Sofia. A mortgage loan was used in 32 per cent of all purchases, Vladikov said.

By the end of this year or in the beginning of 2007 a secondary property market will emerge in Bulgaria. Returning a mortgage loan usually becomes problematic after the third year of the agreement, said Vladikov.

Vladikov said an increase was registered in the price of agriculture plots. Most of the deals in this sector were concluded without a change in the original function of the terrain. The status of agriculture plots changed only in one fifth of all sales, said he.

Comments

Comments by patrick Slattery - 13:21 12 May 2006
	It is unclear from the context of this article why apartment prices should drop. Will prices drop a)because it is difficult to renegotiate renewal and extension of mortgages beyond their initial three year period and b) because there will be a surge in mortgage renewals reaching their three year renewal (or expiry) dates?
Comments by steve b - 12:34 13 May 2006
	Interesting but somewhat convoluted logic. In practice the increasing availability of mortgages opens up the market to a larger audience. The lowering of the mortgage rate will have an accelerating market effect as the mortgage rate in BG aligns with other European countries. The open skies will also contribute as many people discover Sofia secrets and look for investment properties second homes etc etc. So the likelihood is that 12 months from now the prices will be 20% higher not lower we shall see!