Prices of Existing Homes in Sofia Surpass Those of Newly Built In 2007

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Prices of Existing Homes in Sofia Surpass Those of Newly Built In 2007

Property prices in Sofia rose 25% last year, which is the biggest hike in three years.

The limited availability of existing homes up for sale lifted the prices by 40% to an average of 907 eur/square meter. The biggest hike on this segment is recorded in the areas of Liulin, Nadejda and Drujba.

The price increase in Sofia is the highest among the four largest cities in Bulgaria. The average property price in the capital stood at 835 eur/sq m at the end of 2007. Prices rose the most in the neighborhoods of Nadejda, Vitosha and Manastirski Livadi.

The situation on the real estate market in Sofia in 2006 was relatively calm, but it got more dynamic in 2007, and by the middle of the year prices surpassed those in Varna. Still, the average for 2007 remains highest in Varna, according to data provided by Address Real Estate Agency.

Interest in newly built apartments was very high, but at the same time, a great number of such was offered and prices rose just 21% y/y.

A newly built apartment in Sofia could be purchased at 804 eur/sq m. Last year prices of those rose the most in Manastirski Livadi, Borovo and Ovcha Kupel.

Existing homes cost an average of 12% more than new homes last year. The price gap was widest in the city center, as well as in Reduta and Liulin neighborhoods.

Prices in downtown Sofia rose 41% y/y, which is mostly attributed to the lower availability and lack of sites suitable for new construction. The prices of land parcels in the center range between 5,000 and 6,000 euros per square meter, which considerably lifts the property prices.

Property prices in Manastirski Livadi area rose 41% y/y. The new construction determines the average price in this neighborhood.

At the beginning of 2007 there was a limited availability of new homes as investors were awaiting higher prices. After Q1, apartments were offered at prices of between 800 and 1,000 eur/sq m. The figures gradually rose to 1,100 1,300 eur/sq m by the end of the year.

Availability is highest in the areas of Manastirski Livadi, and Krastova Vada.

The price hike in Krastova Vada neighborhood was 30.52%. Most buyers acquire the properties with the aim of renting or keeping them as an investment.

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