Before Bulgaria joined the European Union back in 2007, the level of property investment interest in the nation was already reaching fever point as those looking to get in at a low level into an emerging market where there was seemingly massive room for growth, targeted this particular nation.
Bulgaria was being pushed as everything from a summer holiday haunt to the new winter snow capital of Europe, and investors were snapping up apartments off plan across the country from Bansko to Sunny Beach. Some of these investors have fared better than others – some bought in well constructed and located developments that have remained attractive and of interest. Others bought in shoddy blocks or from a developer who never completed his off-plan offerings. As a result, Bulgaria’s property market has subsequently received very mixed reviews.
In this article we’re going to look at the real reasons to still consider making a property investment commitment in Sofia, the capital of Bulgaria, where we feel there are now some fundamental foundations upon which a solid investment purchase can be made. We’re not going to comment on the traditional coastal and mountain tourism markets, because we fell they have been over hyped and over sold – however, Sofia is a very different story.
Bulgaria, along with Romania, is in a unique position – it is a member of the European Union and benefits from its membership significantly, yet at the same time it remains outside the eurozone and so has not been directly affected by the economic downturn in nations such as Spain and Germany. What’s more, Bulgaria stands out as offering better value for money for investors in many different sectors who are buying in in pounds sterling for example.
This has helped to ensure the levels of foreign direct investment commitment in Bulgaria remain strong – and when you understand that Sofia receives well over half the FDI commitment directly, you can begin to see the potential that this city embodies. What’s more, the Bulgarian authorities have quickly understood the part they need to play in encouraging the free flow of this investment, and they have cut corporation tax rates for example. So successful has their commitment been that they have again secured around a billion dollars worth of new commitment in 2009 from two American energy companies. Not bad going in the current economic climate I’m sure you will agree.
Sofia is the centre for the majority of foreign direct investment commitment. It is also the centre for the majority of business and trade in Bulgaria and has welcomed the likes of AIG, News Corp, Microsoft, Hewlett Packard, IBM and GlaxoSmithKline and the jobs that such companies bring with them. As a direct result, Sofia is expanding rapidly in terms of its output and in terms of its population.
European Union, domestic and international investment is also being ploughed into the development and improvement of Sofia in districts such as Kostinbrod which is specifically in receipt of a rehabilitation grant for the advancement of transport links and infrastructure. Investors buying property in Bulgaria in Sofia naturally benefit from the improvements the city is enjoying – they also benefit from an increasing population which is demanding rental accommodation, and a city that is witnessing strong levels of tourism and business tourism growth too.
All in all, there are some seriously attractive fundamentals supporting a property investment buy in in Sofia at the current time in our opinion…