Real estate market trends for the region of Stara Zagora in the perspective of global market nowerdays
Ms. Kondeva, what was characteristic of the real estate market in Stara Zagora in the past 2020? What do the statistics of the transactions show, what is the reason for the preservation of the interest of the buyers?
The market in Stara Zagora during the pandemic was at high tide, depending on when the restrictions in connection with the epidemiological situation were stricter or more liberal, this also affected the organization of work in our office. Purely psychologically, the closing on March 13 affected buyers and we had several months with virtually no activity. But so it was with all other sectors of the economy. There was uncertainty, uncertainty, it was not known what would happen. There were also problems with lending. Banks have limited funding to certain groups of customers. They changed their lending conditions, things were extremely difficult. In June, there was a revival in the market. And in the months of July, August and September we reported an extremely strong market, very active on the part of buyers. They were both Bulgarian citizens with their own savings and young families who used mortgage lending. Many of the buyers were also Bulgarians working abroad, who were looking for an opportunity to realize their savings in real estate in Bulgaria.
In the last months of 2020, the adoption of the new measures, the restriction of movement, the closure of businesses, offices and schools, again had a psychological impact on the behavior of the buyer. Again, we reported a drop in demand. However, since the end of the year, after it became clear that the vaccine is arriving in Bulgaria, people have calmed down purely psychologically and now we can say that the market is beginning to recover to normal levels. Unlike the closure in March 2020, when banks restricted lending, this has not happened in recent months. Interest rates are also at quite normal levels. Banks finance between 80-85% of the market value for monolithic residential properties, as well as new construction. This led to the retention of interest in buildings - new construction. Even we were surprised that many of them have already sold out. Starting offering them in those months, when we were locked up at home and working online, preparing them for sale, we did not know what to expect. But some of the buildings are currently 70-80% sold out, and it is a building with over 60-70 apartments. I think it is a good sign of the behavior and trust of buyers, which shows that the market is entering a normal rhythm.
What do the data for last year show and what are your expectations for the coming months?
Taking into account the data from the statistics, for the last 5 years the property prices have risen on average by 38% for the country, as the highest growth is in Sofia and Plovdiv, by about 46%. Stara Zagora is in third place in the ranking with 34% price increase. But the total income of households for the last 5 years has increased by 34%. The housing price index and the total income of the population change synchronously, which shows that this is one of the main reasons for the rise in property prices. However, Bulgaria lags behind the other European member states of the European Union in terms of quality of life. The number of mortgages in 2020, compared to 2019, decreased by 12%. However, the amount of new loans increases with decreasing interest rates. The one-bedroom and three-bedroom apartments remain the most preferred. The crisis has not seriously affected the construction sector and we see an increase in the number of commissioned homes, as compared to 2015, they have almost doubled, which shows the preferences of buyers.
For Stara Zagora, there are several new projects that are now on the market in the western part in the area of Billa Store and the Medical Faculty, 5 new buildings are currently under construction, and in 2020 three other buildings were put into operation. We expect more new projects in the area. In the eastern part, the construction of two small boutique buildings, with only 10 apartments each, is currently underway. I guess they will be sold on the green, given the increased interest in the area and the accepted applications that we have registered with us. New projects are forthcoming in the area of Mall Gallery, Zheleznik district, the eastern parts of the city, Artillery Park, Kazanski district. Despite the fact that ERA ROCA has been on the market for only one year, we are grateful for the trust of the builders and entrepreneurs, for the trust of our customers, thanks to which we achieved successful sales over the past year.
The expectations are that 2021 will be more normal in terms of the market. Let's hope that the application of the vaccine will reduce the percentage of patients and there will be no great risk to human health. And this will affect their behavior and work, because at the moment those engaged in entire sectors are out of work.