Buying Off Plan and Why Invest in Bulgaria

Rental and Investment Opportunity
Now has never been a better time to invest in Bulgaria, with recent times having seen record property sales registered. Holiday apartments in Bulgaria's Black Sea and Mountain Ski Resorts have increased by up to 40% in the 12 months to Dec 2004. Forecasters expect prices will continue to increase 20%-30% annually until 2007 at least (the year EU accession for Bulgaria).

Bulgaria’s tourism sector is well established and has recently become one of the fastest growing tourist destinations in Europe. The number of tourists visiting Bulgaria is expected to reach 4.4m in 2005 and as tourism continues to grow exponentially, rental opportunities for the right property are high.

The country has a number of unique features in its favour:

Scheduled to join the EU in 2007
Rapidly emerging property market
The currency is stable and linked to the Euro
Full member of NATO
Established and fast growing tourist industry
Rapid economic growth ahead of EU membership
Property prices currently rising at up to 30% p.a.
Budget airlines expected to start servicing the Black Sea coast from mid-2007 or 2008
Buying Off Plan
Buying an ‘off plan’ apartment in Bulgaria is essentially the same as buying in the UK and means reserving a property on a new development before the property is completed, often before construction has started. Buying ‘off-plan’ can prove a fantastic investment and prices are extremely competitive at this early stage as potential investors only have floor plans and artist impressions of the finished development to view and developers are keen to sell to minimise risk and to provide the project with some forward momentum.

You then have the option of selling straight away upon completion for a profit, or you can hold on to your property for further rental/ capital growth whilst having a great holiday destination to visit. Holding on to the property for a longer-term means you can benefit from Bulgaria’s expected accession to the EU in 2007 where considerable appreciation is expected throughout the Bulgarian real estate market, with holiday apartments expected to lead the way and appreciate the most in value.

'Off Plan' purchases have provided spectacular returns for hundreds of people over the last couple of years. The real key to why buying 'Off Plan' can prove such a good investment lies in the fact that in many cases you only have to pay initially a deposit as low as between 10% - 25% of the purchase price and then nothing until various stages of the project are completed.

If we use an example from our Riviera Fort Beach Apartments

Property

Purchase Price:
Deposit payable:


Total Deposit
2 bedroom apartment with sea view

ˆ 80,000 (Jan 2005)
ˆ 8,000 Deposit payable within 3 weeks of reservation
ˆ 12,000 on completion of the Roof (expected Aug 2005)

ˆ 20,000


Let us assume that you sell the property in March 2006 just before the completion, and that you sell for 100 000 Euros (this is a much lower return than has been achieved in recent years)

Your profit is ˆ 20,000, a 25% return on the ˆ 80,000 asking price, but remember all you have had to pay is a ˆ 20,000 deposit, so your actual return on cash invested is 100%

For our full buyers guide please click here