How safe to invest in Bulgara?

[orlando]

Hi,
I'm planning to do some serious investment in Bulgarian property but
my major concern is related to the political and economical stability
there.
Could anyone share some fought, ideas or experience on this subject?
Cheers
Orlando

[lane]

Hi Orlando,
Investing in Overseas property is no different to the UK market. It is a very delicate balance of supply and demand. There is no doubt that properties in Bulgaria are cheaper psqm than the more traditional EU countries but the major factor that contributes to higher prices is the demand for long and short term rentals. The fact that many Bulgarians themselves go to Turkey for their holidays because it?s warmer and has a more developed tourist industry will have to change. If the market is left with a glut of empty unlet properties in 2 to 3 years and the tourism doesn?t increase massively then the prices will fall. You only need to look at the huge numbers of unlet city centre apartments around the UK that were sold with unrealistic rental projections to budding first time investors, yet they are still building new developments by the dozen. I do not believe that prices will fall and honestly predict that they will increase over the next 5 years at a realistic rate. I do not however think that renting will be easy as you need budget airlines, Airport transfers, Key handover etc etc to do it effectively. It will come but rental opportunities may be limited for the next few years. The other factor that everybody forgets is that you have to sell to realize your profit. It is very difficult to sell a newly built apartment for top money when there are still many developments offering low deposit and guaranteed rental schemes. Overall I am very positive about all eastern European markets, I just think that some of the expectations of new investors are too high.
Just my thoughts but from someone who has been a personal property investor in the Uk/Europe and involved commercially for a long time.
Thank you
Lane