Off-plan housing prices in Plovdiv on par with old constructions

New housing will gain 15-20 per cent in price this year and old apartments are likely to rise by 10-15 per cent, the agency predicted. Old construction is still attractive and  widely sought by first-time buyers who can procure a mortgage. Prices vary between 850 to 1 200 euro a sq m, depending on location and the apartment's condition

Investors have so far unveiled plans to develop retail centres and food chains. Hence it's too early to speak of growth of industrial property segment, according to Europolis. Its rise depends, crucially, on whether investment in production and industrial buildings will turn out to be more lucrative or the mall-construction trend will take precedence. Off-plan residential sales and soaring investment in retail and industrial compounds are dominating Plovdiv's property market this year, according to Europolis international real estate agency's regional office.

Prices of new construction units increased gradually at the turn of 2008, quickly catching up with old apartments, says Daniela Dimitrova, the office's managing director.

More people are buying property for investment or are owners in search of more spacious homes. Europolis agents expect an increasing number of off-plan purchases in the future.

Figures show that last year's new homes sold at 592 euro a sq m and are currently on offer at 735 euro a sq m. The highest price (1270 euro a sq m) was set for off-plan apartments in blocks behind the Trimontzium hotel, Europolis agents noted.

New housing will gain 15-20 per cent in price this year and old apartments are likely to rise by 10-15 per cent, the agency predicted. Old construction is still attractive and  widely sought by first-time buyers who can procure a mortgage. Prices vary between 850 to 1 200 euro a sq m, depending on location and the apartment's condition, Dimitrova said.

Europolis believes that attitudes among foreign property buyers are shifting. There is ongoing demand for rural real estate in municipalities around Plovdiv but they are quickly re-sold after use. Brokers attribute this to unusually high revamp costs and exorbitant prices sought by vendors. This accounts for squeezed interest in nearby regions such as Assenovgrad, Karlovo and Kazanluk.

As far as other market segments are concerned, some of last year's trends will continue throughout 2008. Among them is the booming construction of commercial complexes in Plovdiv, many of which will be completed by the end of the year, Dimitrova noted. Supply of retail space will outstrip demand. 

Some neighbourhoods like Gagarin and Zaharna fabrica (Sugar factory), which have already witnessed over-saturation, are likely to suffer price drops. However, sales have maintained a steady level until now. Depreciation, if any, will be minimal - within 5-6 per cent, she commented.

Thanks to the completion of three or four large retail complexes, such as Grand in Capitan Raicho St and Hot Spot Centre across Bulgaria hotel, rents will not undergo significant changes. Average levels will hover in the 6-7 euro a sq m range and rentals in Plovdiv's main street will continue  heading the list with 100 euro a sq m average monthly price.

The Kapana area has also seen developments. Although in the city's heart, it has not rivalled prime retail locations along Ruski Blvd and Shesti Septemvri (September 6). Besides, foreign tenants are wary of opening a second outlet in one city, which, in turn, additionally stalls the rentals' market.

Around 87 000 sq m of retail space are expected to boost Plovdiv commercial areas' stock. Some of them might prove unprofitable. However, Dimitrova stressed that this does not undermine foreign investors' demand for plots. Their interest is focused primarily on buying land, which has already been re-zoned for construction along Plovdiv-Assenovgrad thoroughfare, due to good communications between the two cities and the airport's closeness.

Investors have so far unveiled plans to develop retail centres and food chains. Hence it's too early to speak of growth of industrial property segment, according to Europolis. Its rise depends, crucially, on whether investment in production and industrial buildings will turn out to be more lucrative or the mall-construction trend will take precedence.

Text source: Property wise

Image source: Mirela