site.btaRussian Holiday Property Owners on Bulgarian Coast Decrease, Bulgarian and Western Buyers on the Rise

"Little Russia" is behind "young Bulgaria" and "aging Europe" on the holiday property market along the Bulgarian Black Sea coast. Half of buyers of seaside holiday apartments are high-income Bulgarians up to 30 years old, working mainly in the IT sector, and the rest are retired people from Germany, France, Italy and the Netherlands.

Two-room dwellings in gated communities are most in demand, and average prices begin from EUR 1,900 per square metre. Maintenance fees in gated communities are no longer startling to buyers, who are currently inclined to spend BGN 60-70 per month for the maintenance of swimming pools, fitness gyms and children's playgrounds. Ukrainian investors are entering the newly built coastal housing market in Bulgaria.

This snapshot of the Bulgarian seaside property market at the height of summer was presented by National Real Estate Association Management Board members Atanas Argirov and Stefka Kalcheva in interviews for BTA.

The North

With housing prices in Varna increasing considerably over the last two years, buyers tend to seek holiday property which they can use as their first home. Housing prices in Bulgaria's largest seaside city, situated on the northern part of the country's Black Sea coast, have gone up by 60% in about two years, while holiday property prices have risen by 25%. Therefore, 20% of people looking for a first home opt for holiday properties.

Many buyers prefer real estate in and around the Saints Constantine and Helena resort, which has become a structural part of the city of Varna. The resort now has more residential buildings than hotels.

Two-room apartments are most popular, accounting for 40% of real estate purchases in Varna, followed by three-room apartments, while studio condos are least sought-after. Large apartments (with more than three rooms) are preferred by between 2% and 3% of buyers, often IT experts who use them not only as a home but also as an office. Over 80% of home buyers prefer property in a gated community because it offers round-the-clock security and regular maintenance of shared areas.

About 60% of new buyers of real estate in Varna and nearby resorts are between 25 and 35 years old, typically working in the IT industry. Bulgarians are the predominant nationality. Retired foreigners predominate among older buyers, but their percentage is far smaller. They come mainly from France, Italy, Germany and the Netherlands, less often from Ukraine and Israel.

As Russian activity on the Bulgarian market diminished due to the Ukraine war, foreigners account for a far smaller percentage of real estate buyers than before. There are Ukrainians among them, although most Ukrainians live in rented homes, hoping to be able to go back to their country one day. Ukrainian investors have entered the Bulgarian real estate market, with two large companies setting foot in Varna. They specialize in high-class holiday property development for clients in the above-average and high income segments.

Despite strong market competition, holiday property prices along the Bulgarian Black Sea coast continue to rise gradually amid high market demand spurred by low mortgage rates. Prices in the Varna area average EUR 1,900-2,100 per square metre. The gradual price rise is expected to persist until the year's end. At the current price levels, a full return on investment can be expected in 25-27 years.

The South

In the Burgas area on the southern section of the Bulgarian coast, interest in holiday property is growing, and half of the deals are with Bulgarian buyers. The other half are with people from Germany, mainly retired individuals who initially lived here in rented homes. People from Poland, Czechia and Israel (mainly Russian Jews) show interest in such purchases as well. These new buyers have partly filled the gap created by Russians who sold their real estate in the Burgas area. Many Russians would rather have stayed in Bulgaria, but they faced visa and transport problems which raised an insurmountable barrier to using their summer homes here.

Holiday property prices in the vicinity of Burgas do not show any tangible increase year on year, just a modest 5-6%, which matches inflation. Sale activity in 2023 and 2024 has been even, with no major peaks. Expectations are that prices will increase by a further 2-3% by the end of 2024, which will put the annual increase at between 4% and 8%.

As usual, people seeking to buy holiday property on the southern stretch of the Bulgarian coastline are most attracted to the resorts of Sozopol, Nessebar, Sunny Beach and Primorsko. A German community has settled lastingly in Aheloy. They invest mainly in gated estates. Ukrainians are interested in buying dwellings in the city of Burgas, drawn by the opportunity for their kids to attend school. Ukrainians are definitely a market factor in Burgas as they are involved in 30% of holiday property purchases. Pomorie appeals to Poles, German-speaking people and Ukrainians. Sozopol and Nessebar are in the upper part of the ranking, along with Ravda and Sveti Vlas.

Holiday properties on the southern part of the coastline are bought mainly by young Bulgarians between 35 and 45 years old, who need a second home. Young foreign buyers are mainly from Poland. These are mainly people practicing liberal professions, including IT specialists, who plan to use their holiday property all the year round. The purchases are usually financed with loans. Between 15% and 20% of the Bulgarian buyers are resident abroad.

Foreigners around retirement age show a lasting interest in the Burgas area. It is a preferred holiday property investment destination for Czechs, Poles and Israelis typically aged between 50 and 70.

In Burgas, just like in Varna, the preferred size of a holiday home is a two-room apartment. Those who buy two-room dwellings and studio condos are usually lower-income individuals who plan to use them seasonally. Two-room apartment fans account for 30-35% of holiday property buyers, and they prefer gated communities in urban areas.

New buyers have no problem paying for maintenance, they even insist on doing this to ensure that swimming pools, fitness gyms and kids' corners are neat and tidy. The latest significant increase of maintenance costs came in 2022, when they rose by between 10% and 12% on account of rising energy prices and wages. New buyers have no problem paying BGN 60-70 per month for maintenance.

Proximity to the sea is one of the most important price factors. In Sozopol, you can buy a fully furnished dwelling in a gated community at walking distance from the beach for between EUR 85,000 and EUR 100,000. The lowest prices range between EUR 65,000 and EUR 75,000, which can be due to unsettled issues with the maintenance company, but this happens very rarely. The main reason for the lower prices is the distance from the sea and from the historical quarters of the town.