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Real estate investment – most profitable

Submitted on Friday, 19 September 2008No Comment

Bulgarian investment in residential property, although low-profitable, brings much higher earnings on the sale compared to investment in financial assets. These findings based on official statistics are mentioned in the report for the third quarter of the year of the “Industry Watch” analytic department.

Housing prices have been raised by 32 percent for one year, the investment in shares or mutual fund brings a negative return on an annual basis, while efficient interest in newly deposits reached 6 percent.

Preliminary data, influx on Real estate FDI is delayed, also mentioned “Industry Watch” Even in a negative scenario and significant drops in investment influx to the country, segment of the mass housing unlikely to be strongly affected.

Against the background of less interest from foreign buyers the importance of Bulgarian emigrants as investors in residential property increased, says the report. Over the past 12 months money transfers of migrants to their relatives in the country reached 2.7 billion euros – more than foreign investment in real estate for the same period. Therefore, according to the “Industry Watch”, a possible change in emigrants’ preferences would be reflected seriously on external demand for housing and is possible to exert pressure on housing prices.

“Industry Watch” forecasts growth of mortgage loans stabilization to levels around 20-25 percent annually over the next two to three years.

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