Investment properties in Bulgaria

“We are planning to buy an investment property in Bulgaria,” – these days, this is one of the most frequent requests from clients from Israel, Germany and Russia that Apart Estate gets. Buyers are considering purchasing houses and apartments by the sea as well as in ski resorts. Their goal is to save free money, receive additional income and at the same time get an opportunity to live in Bulgaria by the sea or in the mountains. Is it worth buying an apartment in Bulgaria for investment? Definitely, yes. Prices for property in Bulgaria rise from year to year, and the flow of tourists does not stop. 

Usually, as soon as some free money becomes available, people begin to think of how to invest it in the best possible way. For a long time, banks have been a safe haven. Unfortunately given the unstable financial situation in many countries, the refusal of banks to accept deposits and low interest rates, people began to look for more stable ways of investing.  One of the most interesting options today is buying real estate by the sea or in ski resorts in Bulgaria. 

Investment properties in BulgariaThere are several reasons for interest in investing in Bulgarian real estate:

  • If you follow the dynamics of prices for sea apartments, it is easy to see that they are only growing. There are periods of minor declines, after which the market quickly recovers, the demand increases, and prices creep up again. Anyone who bought an apartment in Burgas, Bansko, or Sozopol about 5 years ago, today will get rid of it at a 20-25% higher price, even if initially did not plan to sell property and to receive income from this. This is a regular process that involves ordinary people who do not think much about investments. However, there are also buyers who are real investors and who initially plan purchasing property from developers at lower prices. As soon as the residential building is put into operation, the cost per square meter rises significantly. In this case, providing the sale is successful, profit can be received within 2-3 years after the investment. Its value depends on the location of the apartment, initial price, and market situation, but on average it is 15-20%. 
  • When buying residential real estate in Bulgaria, many investors plan to use it for permanent residence, seasonal vacations with family, or moving to a country with a nice climate upon retirement. If you are ready to move right now, it is great. If not, but want to invest money urgently, you can buy an apartment and rent it out, receiving an additional annual  income. Every summer thousands of tourists are looking for accommodation in Sunny Beach, Sveti Vlas, Lozenets, or Chernomorets. In winter and spring, the demand for apartments in Bansko and Pamporovo and other ski resorts in Bulgaria increases. Apartments are popular both in complexes with swimming pools and parks, as well as in ordinary residential buildings. The owner of real estate can rent it out independently, use the brokers' services, or management companies.
  • Commercial real estate is of particular interest from the point of view of investment as well. These are hotels, restaurants, premises where you can open a cafe, a children's center or an office. Buying it, the owner gets the opportunity to develop his own business. It can be a luxury hotel by the sea in Lozenets, or a cozy guest house in Chernomorets. Another option is to rent out the property and receive regular passive income. 

Is it profitable investing in property in Bulgaria

Property for investment in BulgariaYou can buy real estate without thinking whether it will serve as a source of additional money in the future. Such an approach is typical for the buyers who buy an apartment for themselves in Burgas, Nessebar or any other towns. They invest a lot of money in renovation and furniture. But as time goes by, the circumstances get changed, and the opportunity to move is postponed, so they decide to rent their apartment out. 

Often it is from these buyers you can hear that their investment has failed. It turned out that at the time of buying the property, they invested a lot of money and then tried to set high rental or sales prices, but the property market did not appreciate it. The owners were forced to either reduce prices, or refuse to rent altogether.

The buyer, who initially looks for an investment property in order to generate income, carefully plans all expenses, chooses high-quality inexpensive furniture and reliable builders. As a result, the funds invested in the purchase of an apartment quickly pay off. 

A couple of examples for your attention:

  • The client buys a one-bedroom apartment from a developer in Sarafovo, Burgas, as an investment. The price is 37 thousand Euros (55 sq. m). After 1.5 years, Act 16 is received, the buyer makes repairs (50 euros / sq. m) and sells the apartment for 45 thousand euros. The income gained is more than 13%. 
  • A German buyer decided to become the owner of several apartments in a large residential complex in Sunny Beach to rent them out. He bought 2 one-bedroom apartments, which did not require renovation, at a price of 23 thousand Euros each. From May 15 to September 15 he rented them out at an average price of 42 Euros / night (May, September - 35, June - 40 Euros, July, August - 50 Euros). Apartments were not rented out every day, but the overall received income for the summer amounted to 9 thousand Euros. Subtracting the support tax, taxes, electricity and water costs, he received 7.5 thousand. net profit. The purchase costs in this situation will be recouped in about 6 years. From mid-September to the end of October, when in Bulgaria it is still warm, the owner lives in one of the apartments with his family, and invites relatives to stay in the other one. The owner was engaged in this business and controlled the whole process. This allowed him to succeed.
  • A client from Bulgaria bought a studio without maintenance fee in Burgas in the Lazur district for 23 thousand Euros; he completed finishing and purchased inexpensive furniture. The final cost was 27 thousand Euros. Originally he planned to buy an apartment for his son, but the latest was not yet ready to live separately. So, the buyer started renting the property out – from September to May for 150 euros per month (total annual income is 1,350 euros), in the summer - 25 euros / night (on average – 1,500 Euros per season). So, the buyer managed to receive € 2,850 annually at a minimum cost. For 5 years of using the apartment, he received about 14 thousand euros of additional income; the apartment can currently be sold for 32 thousand euros. 

A completely different picture can be observed when buying hotels and guest houses. A properly organized business, focused on specific clients, a wide range of services offered, and a high-quality infrastructure allows you to generate income even if you keep high prices. 

Why is it worth to invest in real estate now

You need to know how to invest. Without understanding the market specifics, you can go broke. By knowing how it works, you will get rich. Investment property in Bulgaria today is a reliable opportunity not to lose money and receive regular passive income: 

People got used to life in a pandemic and began to travel again. From January to September 2021, more than 2.6 million foreign tourists visited Bulgaria, which is 34.8% more than in 2020. The Bulgarians themselves also actively traveled around the country. According to various information, in the summer in Burgas, Ravda, Sozopol and other Bulgarian Black Sea coast resorts, it was impossible to rent an apartment or a hotel room – everything was occupied. 

Active construction process continues in large cities. In Burgas, Sozopol, or Nessebar you can buy a quiet cheap apartment from a developer. This makes it possible to profitably resell it in the future or to think about a rental business.

Prices for quality property on a resale market and from developers began to grow steadily. Nowadays, it is still possible to buy a good apartment at a good price.

Right now, the moment when inflation, blown by the pandemic and expectations of Bulgaria's joining the eurozone, has not yet led to panic in the markets and a sharp increase in demand for real estate. 

Apart Estate makes it easy to find and buy investment properties. These can be apartments, houses, townhouses, offices, industrial premises, as well as hotels. Contact Apart Estate specialists in the offices of Bulgaria and Israel, or by phone and messengers. We will prepare high-quality offers that will meet the most sophisticated wishes.