In Bulgaria, it is more profitable to buy a two-bedroom apartments
Analyzing Bulgaria’s residential real estate market trends showed that now is the best time to buy two-bedroom apartments. At the same time, specialists evaluated the object’s attractiveness in terms of its future sale at a higher price and as a source of income when renting. It turned out that the best solution would be to buy a two-bedroom apartment in the Bulgarian capital to rent it out.
According to the analysis, the payback period of residential real estate in Sofia in renting it out is 20-30 years, depending on the characteristics of the object. For example, an 83-square-meter two-bedroom apartment in the capital is about 165,700 euros. At the same time, the rent of such housing is 550 euros per month. Assuming apartment expenses of about 500 euros per year, the property will be paid back in 27 years.
A two-bedroom apartment in Sofia costs 68 thousand euros, and renting such an apartment costs 360 euros a month. The annual maintenance is estimated at 500 euros, meaning the return on investment will occur within 17 years.
Like two-bedroom apartments, one-bedroom ones are considered a profitable investment
Experts also consider successful investments in one-bedroom apartments. Accommodation in Sofia with an area of 50 sq.m. will cost 58,000 euros, and rent – 250 euros per month. At the cost of about 500 euros per year, the rent will cover the initial investment over 23 years.
However, it is essential to understand that such a market analysis is inaccurate. In this case, the experts did not consider the apartment’s condition and furnishings, although these characteristics directly affect the rental rate. Apartments with good repair are in high demand, reducing possible downtime without tenants.
As for the real estate market in Bulgaria, there is an increase in the price of resort accommodation. In 2022, the prices in this sector increased by 25%, especially the noticeable dynamics in the second half of the last period. Experts believe the main factors behind the rise in home prices in resort areas are a high rate of inflation as well as shortages of supply on the market.
For a long time, there was a limited number of new buildings in most resort areas of Bulgaria. The situation in the major cities was much better. As a result, in 2022, the market faced a serious shortage of real estate, as many owners chose to rent rather than sell. This was also facilitated by an increase in the flow of tourists to the country, which had a demand for short-term rental housing.