The month of April brought news that the prices of real estate in Bulgaria continued their increase in the first quarter of 2006. Housing prices in Bulgaria rose in Q1 by 4.7 per cent from the level recorded in the last quarter of the previous year, the National Statistics Institute (NSI) said on April 25. The NSI data covers the prices of sealed apartment purchases reported by Bulgarian real estate brokers in the country’s 28 regional centres.
Bulgaria’s accession to the European Union will have an impact on the players in the real estate market in this country. Foreign investors in real estate in Bulgaria are currently divided into two groups – the first invest in property with purely speculative motives, while the second group consists of those who wish to keep their property or reside on it.
A large portion of the domestic demand for property in Bulgaria is covered by money from Bulgarian emigrants. Luchezar Bogdanov from the independent analytical company Industry Watch pointed out an example with the town of Sliven in southern Bulgaria, where, according to a survey, about 85 per cent of the newly built apartments are being bought by Bulgarians working and residing abroad.
If Bulgaria is integrated in the EU as fast as possible and with no precautionary clauses, easier migration to member states with higher incomes could be expected, which would enable the influx of more investment money in Bulgaria from emigrants. Such a development will give another boost to the growth of the real estate market and the entire economy.
Meanwhile the evaluation of developments in Bulgaria’s agriculture sector in the final European Commission report is positive. Agriculture Minister Nihat Kabil said that there is a better evaluation, compared to the one in the previous EC analysis. The final report on Bulgaria’s readiness to join the union is expected in September.
The introduction of safeguard clauses for the agriculture sector is highly unlikely. Kabil also explained fund-drainage schemes presented in Bulgarian media recently. All 21 cases involve funds from the SAPARD programme. Diversion of funds is impossible, Kabil said. The attempts actually occurred but all of them failed. Funds in one of the most controversial drainage cases in Sliven were fully utilised.The project was one of Bulgaria’s most successful applications for EU funding.