The real estate sector in Bulgaria experienced a cooling down in the summer

There were fewer issued permits for the construction of residential buildings in Bulgaria in the third quarter of the year (July-September) compared to the same period in 2022. There were also fewer planned flat tower dwellings. It is interesting that, at the same time, an increase was recorded in the number of permits for the construction of administrative buildings, as well as for those marked as “Other”, which usually include office buildings.

From the data report of the Bulgarian National Statistical Institute (NSI), it is clear that the planned overall surfaces of the new administrative and office buildings on the territory of the country have also grown.

Construction permits

In total, the permits issued by the local administrations were for 2,107 residential buildings with 9,805 units in them and 1,136,008 square metres of built-up surface. Compared to the same months of the previous year, the issued permits for residential buildings are down by 2.4%, the dwellings in them - by 33.3%, and their built-up surface - by 31.3%.

The permits issued for the construction of administrative buildings and their built-up surface increased by 78.6 and 38.7%, respectively. Permits for the construction of other buildings are up by 3.3%, and their expanded built-up surface - by 10%.

The largest number of construction permits for new residential buildings were issued in the following provinces:

• Sofia Municipality - 351
• Plovdiv - 344
• Sofia Province - 191
• Varna - 169
• Burgas – 161

The largest numbers of housing units awaiting the start of construction are in the regions of Sofia (city) - 4,099, Plovdiv - 1,218, Burgas - 1,027, Varna - 933, and Sofia Province - 401.

The third quarter of 2023 saw the beginning of the construction of 1,528 residential buildings with 7,576 units and 865,719 square metres of built-up surface. Compared to a year earlier, this represents a decrease of 2% as far as the launch of new construction works, with a decrease of 14.1 percent in the number of housing units.

Housing prices

Meanwhile, Arco Real Estate, a property agency, published its analysis of the Bulgarian market in the third quarter of the year. It shows a decrease both in the prices and in the concluded real estate transactions in the country.

The company reports that real estate buyers are demonstrating more common sense, as they are not in a hurry to conclude a deal, by making rash emotional decisions. Reports show that the initial asking price for properties is often reduced, and sellers tend to compromise.

In Sofia, for example, there was a notable slump in concluded property deals compared to the previous quarter - 7,001 versus 8,615. Decreases in that parameter were also visible in Plovdiv and Varna, but on the other hand, there was an increase in Burgas - 1,931 sales versus 1,736 for the previous three months.

The total number of property sales concluded in Bulgaria for the third quarter was 54,277, only slightly fewer than the second quarter result - 54,371. There is a decrease compared to the same period of the year in 2022 when the concluded deals numbered 62,459.

Bulgarian property market forecast until the end of the year

According to experts, until the end of 2023, there will be no significant changes in the Bulgarian real estate market. The expectation is that there will be no noticeable increase in property prices.

At this point in time, the average housing prices in Sofia maintain their levels from the previous quarter, and depending on the district and their condition, they vary between 1,600 and 1,800 euros per sq.m for a two-room apartment, and 1,500 - 1,700 euros per sq.m for three-room one. In Sofia’s downtown, property prices maintain levels of around 2,500 euros per sq.m., and in the wider central area - around 1,800 euros per sq.m.

Translated by Tzvetozar Vincent Iolov