Analysts expect home prices in Bulgaria to rise 10-15% this year. The past two years have been very successful for the market and experts forecast that the growth tendency will be sustained, a report by Arco Real Estate points out.

Bulgaria's accession to the EU, the good economic perspectives, the country's geographical location and the migrational processes within it are among the key factors influencing the market, is stated in the report.

According to the agency, a total of 325,385 property deals were sealed in Bulgaria during last year, which is 4% up from 2006 and a record number so far. The cities boasting the largest number of property transactions are Sofia, Plovdiv, Varna, Burgas, Nessebar and Ruse.

Analysts think that the number of deals this year will stay unchanged, but their value will grow.

The intensive construction activity in Sofia, Varna, Burgas and Plovdiv will give buyers more choice. More investments will be directed to other large cities such as Ruse, Vidin, Veliko Tarnovo, and Stara Zagora.

The interest in gated residential complexes will continue to stay strong. Analysts expect home prices to add some 10-15%.

The prices of the median home will not change significantly in view of the rising interest rates and increased offering. Luxury properties will see a moderate hike. In the mountain and beach resorts, where construction activity is very intense, lower quality homes will be dropping in value.

Foreign citizens were very active on the segment of holiday homes last year. Between January – October 2007 foreigners bought properties worth 139 billion euros in Bulgaria, compared with 890.5 million for the same period 2007.

The sectors of administrative properties and commercial space are among the fastest developing. Those fields have also been enjoying a lot of interest from foreign investors. The Spanish Riofisa, for example, will be pouring more than 600 mln euros in two multifunctional projects in Sofia and in one in Plovdiv.

The German ECE Project Management is involved in two projects in Sofia and one in Varna. Its investments in Bulgaria will top 580 mln euros. The Polish Globe Trade Center, a unit of the Israeli Kardan group, is working on three investment projects – in the cities if Plovdiv, Vrana and Ruse. The Lithuanian VP Group has plans to invest some 500 mln euros in a large multifunctional park in Sofia.