Property in Bulgaria - A Good investment?

ManAtHome

LOL - Guess who didn't get the job as Phil the Greek's scriptwriter...

Seriously, get some good advice first http://www.bgclubuk.org/modules.php?name=News&file=article&sid=285 - where there's cash, there's nasties.

Ian_W

We used to own an apartment in the Canaries and the best site, IMO, to advertise on for quantity of enquires, many of which converted to bookings is https://www.ownersdirect.co.uk.
I checked out 1 bedroom apartments in the Bulgerian Black Sea resorts and the first 20 with availability calendars averaged less than 6 weeks booked for the rest of this year. Bear in mind some unavailability may be due to the owners visiting and I think you'll really struggle to pay the mortgage, let alone the other costs of running an apartment abroad.
This question's been posted before and some have commented that packages are as cheap as flight only - so there is no/little private letting. If you do buy go for a complex that has a contract with a holiday co. Personally I don't think it's worth it.

clutton_2

there was a fascinating prog on BBC2 tonight on civilisation, and the bit filmed in Dubai was about the fact that an enormous percentage of the folks that actually live there, are the immigrant workers who are building all the high rises .... who is going to buy/rent apartments in this high rise dream world ?

lynzpower

Additionally, I forgot, a mate of mine bought a run down bulgalow/ cottage thing last year somewhere inland. it cost 42k i think and she had about 30ks worth of building gear ordered and paid the builders some of thier money upfront. Of course they did a fllit when she was back here, taking every stick & wire she'd bought for renovation.

A cautionary tale.

lvhomeless

I dunno, sounds kinda risky. Have your friends bring you there first.

missile

sanfrancisco wrote:

I think missile understood, they were being facetious.

As you may have noted, I live in Spain where there are so many people who have been conned into thinking it so easy to buy and rent out property. For sure there is a market and many do it successfuly, but one has to be very careful and there are a lot of pitfalls. To name but a few, where are you going to find tennats, who will manage the property, what if they trash it, what do you do about squatters.

I have property in UK which I rent and that is fraut with problems, trying to deal with those in a foriegn country if you have no experience is IMHO foolhardy:mad:

Takes me back to my previous post. If you want to holiday in Bulgaria and a few extra quid renting to family and friends - fine. As a business venture, there are much easier ways to make money:rotfl:

Anyway must dash, got to enjoy the sunshine :A

Leftynick

Well that certainly food for thought, thanks to those of you who did more than make poor attempts at jokes/sarcasm.. Is just an idea at this stage, and maybe it will prove to be too risky..Need more detailed info really, quite fancy a weeks holiday later in the year so maybe a fact finding mission would be useful...The point about new builds being so freely availbe that no one wants 2nd hand property is a good one and one i hadnt considered...although will that change if the country/resort takes off and travel companys start sending large numbers of people there??? Someone has also suggested to go for one of the resort wich is more "all year round" and does skiing in winter - this would make more sense to me too.... So lots to consider all in all..

Could anyone give any idea on ongoing maintenance/running costs once you've bought somewhere - what kind of things are we talking about? Surely if the apartment is empty there isnt too much to do? What i was thinking is that it wouldn't be critical for us to have it occupied every week of the year so we could let it stand empty for certain quieter periods of time and would hope that in a new, secure complex it would be safe from squatters etc...

Thanks again....

Conrad

Leftynick wrote:

You've kind of missed the point, probably because i wasnt very clear. The idea would be to buy a new build apartment/villa in a busy holiday resort and rent it out to cover the mortgage for as much of the year as possible and take advantage of cheap holidays ourselves. From what i've read you can get a new build 1 bed aprtment in a modern, secure complex with pool etc for around £25k and it looks like there are going to be lots to choose from as there is a heck of a lot of development going on over there at te moment....

Left Ive bought some property abroad. I considered Bulgaria 3 years ago and decided Sofia the capital was the best bet as the rental returns in tourist areas (note the very short season) were / are very patchy what with the vast over supply of new build. I didnt go for Bulgaria as there was too much risk in terms of lack of state controls and transparency plus there is no viable second hand market as most investors want off - plan.

Morocco is the place to be for now with many international developers (including the people behind Sun City South Africa and also Emaar the worlds biggest developer) and hotels investing there and low cost airlines battling for this 'close to the UK' market.
Agents such as Superior International are reporting Morocco is suddenly the most requested place.

Im also investing in Berlin and looikng at Estonia, but Morocco is definately the place to be BUT MAKE SURE YOU ONLY DEAL WITH BIG INTERNATIONAL DEVELOPERS.
Ive gone for 'LeJardinDeFleur' which is a luxury enclave within a vast development called 'Saidia'. Saidia is high end total luxury with an 800 berth marina, three 18 hole golf courses and crucially lots of international designer shops (this is v unusual), plus masses of top facilities.

Conrad

Leftynick wrote:

You've kind of missed the point, probably because i wasnt very clear. The idea would be to buy a new build apartment/villa in a busy holiday resort and rent it out to cover the mortgage for as much of the year as possible and take advantage of cheap holidays ourselves. From what i've read you can get a new build 1 bed aprtment in a modern, secure complex with pool etc for around £25k and it looks like there are going to be lots to choose from as there is a heck of a lot of development going on over there at te moment....

Left Ive bought some property abroad. I considered Bulgaria 3 years ago and decided Sofia the capital was the best bet as the rental returns in tourist areas (note the very short season) were / are very patchy what with the vast over supply of new build. I didnt go for Bulgaria as there was too much risk in terms of lack of state controls and transparency plus there is no viable second hand market as most investors want off - plan.

Morocco is the place to be for now with many international developers (including the people behind Sun City South Africa and also Emaar the worlds biggest developer) and hotels investing there and low cost airlines battling for this 'close to the UK' market.
Agents such as Superior International are reporting Morocco is suddenly the most requested place.

Im also investing in Berlin and looikng at Estonia, but Morocco is definately the place to be BUT MAKE SURE YOU ONLY DEAL WITH BIG INTERNATIONAL DEVELOPERS.
Ive gone for 'LeJardinDeFleur' which is a luxury enclave within a vast development called 'Saidia'. Saidia is high end total luxury with an 800 berth marina, three 18 hole golf courses and crucially lots of international designer shops (this is v unusual), plus masses of top facilities.

The great bits:

1) Wont complete until 2009, so my 40% deposit leveredges me into the 100% value and u can sell the contract anytime. I think the price will double by completion.

2) Its a vast highly secure development with everthing in one place, even a small hospital, Swiss rental agency, 2 international supermarkets etc

3) Its a year round season and the THREE 18 HOLE GOLF COURSES PLUS 7KM BEACH and vast array of facilities all within the one site should prove a massive draw

4) An 800 berth marina is a major plus. Even top class Spannish resorts (a few miles accross the sea) cannot boast this plus large beach plus 3 golf courses.

5) 8 top hotels are being built within this single development. The thousands of guests will be exposed to the small number of rental properties and should provide an audience most other developments in the world simply do not have

6) Once the accomodation is sold within this prestigious site, thats it, no more


Ive gone for a detached villa with own fully maintained private pool and garden, set right into the golf fairways. It costs 4.5 x less than something in La Manga Spain which has vastly less facilities and no real beach or marina.

Other developments are springing up all over Morocco but Saidia has the advantage of being on the Med coast, so closest to Spain / UK and warmer / less windy in winter.

It really is a once in a lifetime opportunity to get in first.

Ian_W

Could anyone give any idea on ongoing maintenance/running costs once you've bought somewhere - what kind of things are we talking about? Surely if the apartment is empty there isnt too much to do?

I've just cut and pasted this list from my 2004/5 tax return. Can't give you figures as it depends on local costs wherever you buy, BUT these are things you can find out about in advance of taking the plunge.

Cleaning and laundry - if you want reliability best to use an agent to organise this
Electricity & Water - often cheaper than UK, even in barren lands
Community Fees - for gardens, pool etc
Maintenance & Repairs - surprising what can go wrong when you're not there, again a trustworthy local agent is a boon
Council Tax and Refuse - again usually cheaper than UK, Spain typically £200 - £250 for a 1 bed apartment
Agents Fees - bookings, organising cleaning, maintenance when you're absent
VAT - on any services provided
Local Income/lettingTax - and probably the services of a local tax advisor, if you don't pay some countries can register the debt against your property
Sat TV Subscription - expected now by discerning private renters
Holiday Home Insurance - If you're letting don't just go for buildings and contents, should give you cover for guest liability, cancellation and when empty for extended periods
Interior re-decoration - If, as Spain the typical interior is white walls you'll either be DIYing or paying for redecoration every couple of years
Advertising - need to target towards potential guests
Postage, stationary, Telephone Calls - general admin costs of letting
Website & Internet - Domain registration & hosting if you want your own site.

Of course you must tell the IR and any profit you make is taxable, any loss may be carried forward to offset against future tax liability.
We would have broken even on about 20 weeks letting but managed over 45 for 8 years so earned a modest profit and a decent capital gain when we sold. However it was an established resort in the Canaries which has the advantage of a 12 month season.

I think Bulgeria is high risk ATM because of the issues raised in earlier posts [short season, packages as cheap as flight only, no resale market, ? EU membership] but risk does sometimes bring high rewards. Just remember though that it's high risk because more often than not, it won't.

A holiday is a good starting point. If you like it and can afford the costs & finance without letting all the time then it may be worth a dabble. BoL, whatever you decide.