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Why Choose Bulgaria for Property Investment?
from: ...Tip! Allow 10% extra for expenses. The cost of buying a property abroad (taxes, conveyancing, lawyers fees, agents fees, VAT, etc) can be much higher than in your own country.
Bulgaria is a country of immense variety, both geographically and culturally. As a destination, the country has received widespread recognition within the last couple of years. Although Bulgaria is fast becoming one of the most popular countries for tourism, there are still many locations that have not yet been discovered - so if you are looking for an up and coming resort, this could well be the country to start your search.
Tip! Depreciation of items in the property such as washing machines, furniture, etc.
Also Bulgaria's full potential has yet to be fully recognised or achieved. With the economy growing at 6% per year and unemployment falling fast (just 12% currently), Bulgaria's economy is quickly integrating into the EU prior to its anticipated membership in 2007. Internal investment continues apace with international organisations predicting continued economic prosperity for the foreseeable future.
Initially the interest from International investors in the property market was generally concentrated in the coastal beach resorts of the Black Sea. Now as the market has developed and matured there is an ever-increasing variety of property becoming available which appeals to the differing interest and needs of international buyers. If you are looking to invest in property in Bulgaria, you can now choose between the beautiful mountain ski resorts, historic villages, the Black Sea Coastal Resorts or the capital city of Sofia.
Tip! House-hunting Expenses. Property-hunting can be quite a costly business. Expenses include money for travel to Bulgaria, hotels and eating, and telephone calls.
One thing to bear in mind is that the weather in Bulgaria is definitely season controlled, so although buying one or more apartments in say Sunny Beach should also bring you a rental income through the summer months, it will not be rented over the winter, as temperatures are often below freezing - not a nice place to be when the resort is not equipped for winter letting. If however, you decide to go for a mountain resort like Bansko, then you will obviously find that the best rentals are often going to be during the skiing season, but as Bansko in particular is an established town, there is still plenty to see and do during the other seasons. So you would normally expect to receive a longer rental period for a property in Bansko than in for example Sunny Beach.
Is this the right time for investing in property
There has not really been a better time to invest in property in Bulgaria, and record property sales have been recorded recently. As an example the sale of holiday apartments in Bulgaria's Black Sea and Mountain Ski Resorts increased by up to 40% in the 12 months to Dec 2004, and a further 25-30% in year to Dec 2005. Forecasters expect prices will continue to increase 20%-30% annually until at least2007 which is when Bulgaria is expected to become a member of the EU. Bulgaria has made a bid to host the 2014 Winter Olympics, and if successful these would be in Vitosha (Sofia), Bansko and Borovets. If this was to go ahead then there would be great improvements within those areas, again giving a good chance of gains on investment property.
Tip! Home conversions, if carefully though out and well planned can often add significant value to the price of your property. Whether it be a loft or basement conversion or adding a conservatory, these are areas where you should seek professional help.
The tourism industry in Bulgaria is now well established and it has in fact become one of the fastest growing tourist destinations in Europe. The number of tourists visiting Bulgaria is expected to reach between 4-5million in 2006. As tourism continues to grow, rental opportunities for the right property are high, which in turn makes this a good opportunity for property investment.
The currency (leva) in Bulgaria is stable, and is linked to the Euro, and this together with the fact that Bulgaria is politically and economically stable, that NATO membership was achieved in 2004 and it is in a good strategic geographic location are all pointers that would indicate a good return on property investment here is a real possibility.
Tip! Do a seasonal try-out when buying property abroad. What looks like an attractive place to live in summer can be a very different proposition out of season.
At the moment one slight drawback is that no ‘foreigner' can own land within Bulgaria - this would not cause a problem with an apartment, but if you wanted to buy a village house or have a new villa built you would have to buy in the name of a Bulgarian company which you would need to set up. Although setting up a Bulgarian company is a fairly simple process (for those who know what they are doing) I would always advise using a solicitor for this. It is likely that once Bulgaria is in the EEC then the rules for ‘foreigners' buying property will fall in line with the rest of Europe.
Tip! If at all possible, talk to expats who have already bought property in the country. They will have the inside knowledge you need to make a sound decision.
If you decide to look at buying a property in Bulgaria either for an investment, or for a holiday home, then do lots of research to see which area you would prefer to buy in, ask lots of questions of your agent and most of all if you are intending to buy as investment and for personal use, make sure you go and visit the areas you have shortlisted.
Looking for an Investment Property Abroad can be a minefield, so David recommends that you visit http://www.properties-espana.co.uk for information on property for sale in Bulgaria, Portugal, Tenerife,
Cyprus Turkey and Spain.
Please feel free to use this article but keep the resource box and links as they are.
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