Why is real estate in Sofia so insanely priced?

20 comments

1. The Bulgarian housing market is not healthy. That is not to claim that it is a dangerous investment.

   There are many people who buy housing units and don’t use/rent them or use them only for the summer and then do not rent them. Reasons are many and it’s done by foreigners as much as nationals.

2. 1. Real estate bubble
   2. Buying downtown property is always going to be pricey. The good thing about Sofia is that it’s small in size and public transport is quite good, so you can buy something for half the price 7-8km away from downtown and still be able to get there in 15-20 minutes.

3. It’s overpriced because of inflation. We Bulgarians (not all of us but probably 90%) know only one investment – real estate. So when inflation start to climb the people start to buy RE like crazy. That pump the price a lot.

4. Supply and demand and it is the capital 🤷🏻‍♀️ there is a 15% price adjustment in Toronto at the moment. The USA market is expected to adjustment 20% with intrest rates schedule to go up next year. Cost of living is going up every where… wait if you can

5. So for a comparable apartament, how much would an apartment /m2 cost right next to the Buckhinham(spelling) palace cost?

6. My boy looking at Vitosha street and complaining. the prices are a bit overpriced, but nothing unordinary.
   Name one European capital where you can buy apartment in “perfect center” for less.

7. As others have said, lack of investment culture but I’d also add very low property taxes.

8. It’s expensive everywhere in Bulgaria. It’s like the real estate market decided to move from leva to euros a while back and simply changed the currency but kept the same price, essentially doubling the price.

9. It’s the centre of the capital man.

10. In countries where there aren’t developed capital markets people usually invest primarily in real estate because they think it’s super safe (which is not the case ofc). Sofia is an interesting case because basically the whole country participates in the regional real estate market. Prices have been increasing steadily in the last years and people just do everything they can to get themselves a property in Sofia. Additionally, some people seem to think that there is something very prestigious and noble in owning a property in the capital city, idk why. And when you add the macro factors of low-interest rates, increased money supply, and higher prices of building materials, you get a ridiculous bubble imo.

11. What do you want from the centre of the capital? Not to use strong words but your tone is of a person with weird intentions.

12. Very good question. It is purely insane.

13. Inflation increased the prices even more recently – you can check the correlation in the statistics.
    At least the rents remained the same, but I’m sure a correction of the RE prices is going to happen soon, because this is just not sustainable.

    When the interest rates go up prices are BOUND to fall down, because otherwise the market is just going to stagnate and many people cannot afford to wait and play the long game, especially if the bought the properties as an investment.

    So sooner rather than later the numbers are about to change – it depends how fast the bank increase their rates.

14. My man, that second apartment is right across the parliament building, you can see it from the window as it is across the street. If thats not prime real-estate then I don’t know what is. Serdika metro is a 5min walk from there.

15. In my wildest optimistic dreams I can see the city with fixed and great public transport, streets and parking in ten years. Then these prices can make sense.
    I don’t see this realistically happening in less than 20 years.

16. What makes you think it’s Russians? It’s probably Germans and Brit’s buying as an investment

17. look at a northwest village in bulgaria and tell me where else in the world you can buy a house(which will needwork) with a plot of land for a few thousand euroes… big cities are bad for ya

18. I was asking myself the same question recently. My answer to it is that many people in Bulgaria, especially the older generations, but also many yongsters are financially illiterate. Thus everyone with spare money is looking to park them in real estate. This boosts up the prices which do not correspend to the average salary.

    Other answer would be that people are richer than they seem in statistics, because they declare less money than they earn if they declare any.

19. It’s a capital city. It’s like that all over the world. Plus Bulgarian real estate overall is definitely more expensive than it used to be.

20. There’s 3 things that matter for real estate price – location, location, location. I don’t know what you expected looking at properties in the ideal center of an EU capital. Additional construction in that area is impossible, so you can’t just get a new building. There are a lot of neighboring regions that are not ideal center, but are near a metro station, schools, grocery stores, etc. and their price is at least half of that.

    A lot of the apartments in the ideal center are owned by aristocratic babushkas so they haven’t been maintained or renovated since the fall of the soviet union. Once they die, their kids will sell the property if they don’t want it, so that’s why you get what you see in the first offer. You are not expected to just live there, but rather strip everything to bare walls and rebuild it. A lot of them have high (3m+) ceilings, which is a big bonus compared to prefab blocks and new construction, which can go under 2.40m with installed floor and suspended ceiling.