01 November 2007 Newsletter

Raiffeisen Bank to lend home Loans to foreign clients

Officials from Raiffeisen Bank have announced that the bank is starting to lend home loans to British and Irish clients in Bulgaria, which will enable them to buy holiday properties, houses and apartments – either completed or in a rough state of construction.

The loans will be given in EUR or BGN for a repay period of up to 25 years. Also there will be a gratis period of up to 12 months, when the client will be required to pay only the interest. The bank will finance up to 80% of the market price if the property has been completed, and up to 70% if it is in a rough state of construction.

The minimum amount of the credit will be EUR 5000 or its equal BGN value. Last month Refeisen Bank offered on the market a leasehold property program for foreign clients. The maximum leasing period is 15 years, with client's participation 30 to 40% of the property value depending on the phase of completion of the property.

Dnevnik Daily
22 October, 2007

FDI in Bulgaria seen topping EUR 5 billion in 2007

Foreign direct investment in Bulgaria (FDI) will top EUR 5 B this year, the country's investment agency BAI forecast on Tuesday.

Last year, Bulgaria attracted EUR 4.4 billion, nearly one fifth of the total flow into south eastern Europe, according to the data from the latest United Nations Conference on Trade and Development (UNCTAD) World Investment Report, presented in Sofia on Tuesday.

The biggest chunk of the funds, nearly 35%, was in real estate, with another 25% into production capacities, according to BAI.

Bulgaria ranked seventh in terms of FDI-to-gross domestic product ratio over the 2004-2006 period, largely due to the inflows ahead of joining the European Union in January 2007. And the figures will remain high if Bulgaria pushes through with the EU-mandated reforms in the judiciary, accountability and fight against corruption, which will further improve the business climate, the authors of the UNCTAD report said.

Sofia News Agency
16 October, 2007

Bulgaria attracts young tourists

Bulgaria was visited by 4.5 million tourists in the first nine months of 2007, an increase of 7% over the same period of last year, Bulgaria's top tourism official said on Monday.

The sector's revenue also rose by 17% in the first nine months of the year. The country has started attracting an increasing number of young holiday-makers and tourists from Eastern Europe, the head of Bulgaria's state tourism agency Anelia Krushkova told reporters.

Foreigners visiting Bulgaria have spent EUR 340 on average, with 70% preferring three- and four-star hotels. Cuisine, entertainment and nightlife got the highest marks, she added.

Bulgarians have not lagged far behind, spending an average of EUR 300, preferring more modest accommodations.

Sofia News Agency
22 October, 2007

Russian clients tend to buy more Bulgarian properties than British clients do

EUR 1.17 Billion Has Been Invested by Foreign Clients in Bulgaria's Property Market Over the Past 9 Months

While there is no decrease in the number of foreign buyers, property supply in Bulgaria is still very big.

According to D. Ganev, President of a real estate agency, Bulgaria ranks third with British clients as a favorite destination for property buying.

British investments in Bulgaria's property market keep on being very high, but they are already rivaled by Russian, Romanian and other foreign investments. Statistics by Address Realties show that for the past 9 months property purchases by Russian-speaking clients have exceeded those by British-speaking clients. The tide has turned and now the Russians are leading the competition.

Still British and Irish buyers keep on being very active. Since the beginning of 2007 a growing number of young English buyers between 25 and 30 years of age have been looking for properties in the regions of Sofia and Veliko Turnovo. Before that only retired foreigners used to buy houses in the region of Veliko Turnovo.

Young foreign clients have greater expectations in Bulgaria. Alongside with the chance of being able to afford a house in a country with a favourable climate and a low cost of living, they hope to start their own business and make money.

Because of the short distance to Greece and Bulgaria's accession to the EU, the number of Greek property buyers has doubled.

Realties expect a growing number of clients from Denmark, Sweden, Finland, Belgium, France, Hungary and the Czech Republic. A good number of property deals with German buyers is expected in the next 1-2 years.

Since the beginning of 2007 the group of Romanian clients has expanded. At first they were looking for properties in places near the border like Rousse, Silistra, Balchik, Shabla.

A growing number of Romanians are now interested in mountain resorts like Pamporovo, Bansko and Razlog.

Banks in Bulgaria are responsive to the growing consumer demand. Over the last two years a great number of financial institutions have been lending loans to foreign clients for the execution of property deals.

Foreign investors' interest in golf projects is also expected to grow. Some of the golf complexes have been completed but most of them are still under construction. Bulgaria keeps on being attractive for foreigners not only because it is an affordable destination but also because it offers good opportunities foe sea, mountain and spa holidays.

This is confirmed by foreign investments data: One-third of all investments are by foreign citizens who have bought Bulgarian properties.

Foreign capital of EUR 1.17 billion has been invested in this country over the past nine months. This is double the value of foreign investments for the same period of 2006 (EUR 666 million). The total value of investments in Bulgaria for the past nine months has been EUR 3.24 billion.

Foreign clients' attitude has changed. Until a year or two ago they used to buy properties with the intention of fast resale and a large profit; now they are making long-term investments and are seeking profit not only in reselling but also in renting properties. The number of foreign buyers of properties in Sofia and the big towns is also growing.

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18 October, 2007

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