To Buy or not to Buy a property in Bansko,Bulgaria.That is the Question?

Andy Biggar, September 6th 2006, 12:04PM

As Managing Director of Property Find International I am asked many times as to why Bulgaria is such a good investment and why are so many people taking the plunge and placing their hard earned cash into an apartment or villa in either Sunny Beach, which is the Bulgarian equivalent of the Spanish Costa’s or one of the ski resorts such as Bansko, which offers quality skiing at a fraction of the price of France, Switzerland or Italy.

The simple answer to this question is that Bulgaria is currently the poorest country in Europe and with EU membership expected in 2007, the property prices can really only go one way and that is up!

My resume as to why?

When investing in a new emerging market, it is important to look at the country and its people and how they live, and then to make your own decision as to where you believe the country will be in say five years time.

The difference in the standard of living between the average Bulgarian and the average citizen of Western Europe is huge, which could be considered to be an understatement

Salaries in Bulgaria are extremely low compared to those of Western European countries.

A good wage in Bulgaria is around £200 to £250.00 per month. The bar staff who were working in a hotel of a major international chain in which I was staying on my last visit to the capital Sofia two weeks ago, were earning just £25.00 per week! Furthermore, this is for a six day week.

The Bulgarian work ethics are truly enviable, one morning at around 7.00 am, I went for a walk in the town square behind my hotel and there was a waitress from the hotel with a bucket and a sponge, wiping down the already clean hotel’s advertising board in the square. This I later discovered was a daily chore for her and one she completed without complaint.

The Bulgarian people are certainly not frightened of hard work and the service levels I have received in my many visits on behalf of Property Find International, have been amongst some of the best I have ever had.

They are a very proud people and will always work to receive money rather than rely on hand outs, an ethic that would be greatly appreciated in a lot of other countries I feel.

Western influence is now starting to show in all of the major town and cities, such as Sofia, Varna, Bourgas and Plovdiv where the infamous Western fast food restaurant chains are popping up at least half a dozen times in any one given area.

This is a great indication that better times are on their way, as these large corporate conglomerates would not be investing their annual profits into an area that was going to continue to go downwards financially.

Western supermarkets and numerous other Western retail outlets are also honing in now, on what they believe will be easy pickings in this new emerging market and are out to buy the loyalty of the local population before their competitors appear on the scene.

Well know brands of pet food and chocolate bars are being advertised on buses, billboards and taxi’s in fact everywhere, providing an inevitable western European selection of products to select from.

Bulgaria’s infrastructure is being greatly improved by EU membership and is bringing investments of millions of Euros not only from the European Union itself, but from commercial enterprises looking get an early foothold and capitalise on the low cost land that is for now so readily available.

The main roads from the airports at Varna, Sofia and Bourgas are being improved and will reduce transfer times to the main tourist destinations enormously, making the journey a much more pleasurable experience, without the need to hang on to the bottom of your seat as you are thrown towards the roof as you go over yet another pot-hole or crater, as they would have been better described.

The airports themselves are going through enormous expansion projects in order to cope with the increase in tourism which is happening right now.

In 2005 both Sunny Beach and Bansko saw the greatest increase in tourism levels than any other European winter and summer holiday destinations.

This in itself is a very positive sign, especially when you consider that the frequency of flights is still not as often or as low in price as they should be from most of the major airports of Europe.

The low cost air lines are already bidding for the flight routes which will be open once EU membership is granted. This will certainly bring more much needed flights and considerably lower prices in order to cope with the increased tourist demand. It is even rumoured that Sir Richard Branson is bidding for the national airline. British Airways have alreadt announced that they will be flying directly to Varna as from October 2006.

Property Hotspots of Bulgaria

Primarily there are two property markets in Bulgaria, sun or ski and Property Find International has had tremendous success in selling off-plan developments in both of them over the last 12 months.

Our last development in Bansko, which consisted of 130 apartments was sold out in just six weeks!!. This is a record for Property Find International, we have never known of a development sell so quickly, the demand is by far outstripping availability.

Sunny Beach

Sunny Beach is as I previously mentioned, the “Costa Del Sol” of Bulgaria. This busy town has something for everyone, great nightlife, excellent restaurants, beautiful white sandy beaches and crystal blue sea.

The Spanish Costa’s have proven to be an incredible investment over the last decade and Sunny Beach is set to truly emulate this success.

For families looking to holiday on a budget and who require all amenities and entertainments to be close to hand, the potential rental demand is massive.

Sunny Beach resort was awarded the prestigious Blue Flag International prize for proven ecological advantages and with 1,700 hours of sunshine from May to October it offers a very long rental season, which will maximise rental yields.

WHAT CAN BE FOUND IN SUNNY BEACH?

A wide semi-circular bay facing east with an 8 km long beach strip, 30-60 m wide with fine golden sand, natural dunes, a clean and gently sloping shoreline no dangerous fish 1700 hours of sunshine from May trough September.

Average daily temperature in summer 27°C.

8 hotels with over 27,000 beds plus holiday villages and campsites .

Over 130 restaurants, entertainment and folk-style spots, night clubs, bars, discos, cafes, medical and recuperation centres.

Kindergartens, children's playgrounds, children's pools, fun and games.

Open-air theatre and an outdoor cinema.

Shopping centre, arts and crafts bazaars, farm produce.

Regular boat and bus connections to the district centre of Bourgas - 35 km and Varna - 95 km

Property prices in Sunny Beach have risen by 25% over the last 12 months and front-line beach apartments are now selling at a premium but still offer incredible value for money by comparison to Spain.

A front-line beach, 2 bedroom apartment in the Costa Del Sol would currently cost in the region £250,000.

In Sunny Beach, however, you would currently pay in the region of £85,000.00, just 34% of the purchase price of the equivalent apartment in the Costa Del Sol.

This really does emphasise the potential capital growth that the area offers and linked with the demand for rental property and an estimated rental yield of between 6% to 8%, Sunny Beach is an investment opportunity that should be very seriously considered by anyone looking to start or diversify their property portfolio.

Bansko

Tucked away in the foot of Pirin Mountain is the town of Bansko.
Equally attractive during all four seasons, the town offers a variety of conditions for recreation and repose. Bansko is popular for its wonderful ski tourism opportunities combined with distinctive folklore and ancient Bulgarian architecture. Bansko has been proclaimed a place of world natural heritage by UNESCO.
Besides the beautiful Pirin Mountain and the numerous landmarks the town is abounding in it’s historical sights - there are around 120 monuments here alone.

The beautiful Pirin Mountains are a very popular place for visitors such as walkers, in the summertime and in the winter it becomes a paradise for skiers. The fact that Bansko offers all year round rentability, is an enormous attraction to investors.

The snow blanket stays from the autumn right through until late springtime and attracts skiers from all over the world. Excellent ski runs, a cool wind and sparkling sun are all part of the fascinating experience called Pirin.

Bansko is located in the southwest part of Bulgaria - 160 km away from Sofia. The geographical location of the town furthers the retention of the snow coverage from December to May and the alpine character of Pirin Mountain offers perfect opportunities for both professional and amateur ski sports practice.

A total of 56 km of ski runs are perfectly maintained through their treatment by 12 Kassbohrer snow-stamping machines. The ski season is guaranteed from December to May thanks to 30 «Techno Alpine artificial snow guns.

The altitude of the highest point of the ski center is 2560 m, the lowest - 1000 m. 80% of the tracks are equipped with artificial snow generating machines.

Bansko is also a candidate host of 2014 winter Olympics.
There has been an investment of £21million in Bansko to install state of the art ski lifts to make the ski experience for tourists a very peasurable one which does not include long queues.

Property prices.

Property prices in Bansko have risen by a staggering 25% in the last 12 months and are set to continue to rise for the foreseeable future.
One month ago, the local municipality halted all future planning permissions and so if a developer’s application for planning had not been received by then, it would not be granted and the land could not be built on.

This is not great news for developers, but it is great news for investors as a block on future builds means that over-supply will not be an issue and demand for rental properties will be high.

If you compare a 1 bedroom apartment in a ski resort in Italy or France which would currently set you back around £270,000 to a similar property costing only £70,000 in Bansko, with its excellent snow record. Again it really does prove what fantastic value for money Bansko is.

Conclusion

I hope this report answers some of the questions that you may have had about Bulgaria and investing in this new emerging market.
Bulgaria is and will be for a long time to come, an excellent investment opportunity and one that will reward early investors greatly.
Look back to Spain twenty years ago and think of what those properties that were purchased then, are worth today. I truly believe that Bulgaria is the next Spain and so I would recommend anyone who is looking to invest in overseas property, to buy now and maximise their returns.

Over the next three to four years, myself and many of my fellow property pundits are predicting that the property prices in Bulgaria will in fact double and we feel that the timescale of three to four years is very much on the conservative side.

My advice is to buy now and watch the value of your property purchase go up and up!

Tags: , bansko, bulgaria, investment, property, property investment, sofia, sunny beach, varna
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