Why Bulgaria?

The 7 key considerations
When investing in property we believe there are 7 key considerations:

• Capital Growth linked with country economic growth and stability
• Yield (& vacancy rates)
• Location
• Liquidity
• Demographic changes
• Recognition of title
• Property finance

You really need to get a tick in the box on most (if not all) these items before you jump into any property market. We will address each of these issues in turn to see why Bulgaria currently offers a compelling investment opportunity.

Capital growth/economic stability

• The economic backdrop of Bulgaria is very favourable
  GDP growth is now averaging 6% per anum - over twice that of UK
  Bulgaria is now part of the European Union
  High growth in inward investment
• Significant reduction in unemployment over the past four years
  Property values on the Black Sea coast are less than 35% of Spain (less than 25% compared to Marbella) yet have similar facilities and summer weather conditions.
• Property values in Bulgaria's best skiing locations, Bansko, Pamporovo and Borovets are around 25% of equivalent Alpine resorts yet they offer comparable skiing quality at a much lower cost.
• In the unlikely event of Bulgarian economic weakness there would be negligible impact on jet2let property since nearly all buyers are overseas investors or tourists and prices will be supported by on-going demand and yield from tour operators.

Current yield, future yield (& vacancy rates)
Definition: Yield is the annual rent that you receive as a % of your purchase price.

• Since property prices are so low yields are twice that of Spain typically averaging 6% to 10% (gross) in Sofia.
• Tourism is growing rapidly. 2006 saw a 60% increase in the number of British tourists visiting the country.
• Most major British tour operators are offering holidays to the Black Sea coast.
• The new terminal has opened at Sofia airport and it is expected that more and more of Europe's low cost airlines will be be flying there soon.
• Why will more tour operators keep coming and coming ? Because they can charge similar prices to Spain yet they pay a lot less for the accommodation making far bigger profits.
• For good locations rental yields are expected to increase substantially as tour operator demand increases but supply in premium locations is restricted. 

Liquidity
Definition: The ability to be able to buy and sell quickly i.e. a ready market of buyers and sellers  

• There are many purchasers in Bulgaria ensuring a ready market if you need to sell quickly (even before completion). jet2let will actively help you to market to new purchasers even before completion.
• Tourism is increasing dramatically and thus for premium locations there should always be a ready market. jet2let only deal with premium sites. 

Location

• There is currently a substantial investment in road improvements (by the EU) cutting down travel time.
• Two new roads from Greece will be completed in 2009 thereby attracting more and more Greek visitors and investment
• The Black Sea coast boasts 220km of sandy beaches and over 1700 hours of sunshine from May to October.
• On-going news coverage is making Bulgaria a far more acceptable place to have a second home. 

Definition: Changes in population mix due to changing sources of employment, population growth (or decline), immigration and emigration.  

• The population in Bulgaria has been reducing by 0.9% p.a. Population declines normally negatively impact on property investment (for example, property in small towns in East Germany have been badly hit). However the reverse is true for the Black Sea cities, ski resorts and Sofia. The foreigner population is rising by 11% a year on the Black Sea. Sofia by even more.
• It is now estimated that Bulgaria will have a skills shortage and over 250,000 people are expected to move to Bulgaria by 2011.
• Bulgarians are moving into the capital city, Sofia and to tourist areas to enjoy higher wages and lower unemployment. This trend will continue. 

Recognition of Title 

• There is little point in buying property if there is any risk of losing title through corruption, legal ineptitude, irrational government proclamations or otherwise.
• The rights to ownership are strong with an excellent notarial system to ensure property rights.
• One word of warning: it is important to have good legal support when buying in Bulgaria. 

Property Finance

The property finance market in Bulgaria is becoming more competitive with not just better rates but better terms. A buy to let, non status, mortgage is available, but at the expense of a higher interest rate.

We recommend you contact www.bulgarianhomeloans.com for the latest finance deals.

Up to 75% LTV is currently available