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Growth of Apartment Prices

A report based on NSI data was written by Polina Stoykova, Chief Operations Manager and Head of Research, PMR. You can find the full report published on 26.7.2012 below.

When we read the report we saw the average price is quite low, around 500 Euro per meter.

We asked Polina, why is the average price so low and does it represent the prices for better apartments in Plovdiv. This is what Polina replied:

"The average prices in the NSI data are based on apartments in old buildings. Luxury apartments are excluded from the data to ensure the comparability of observations in different cities and in the course of time. This is why you find this gap - listing prices of 1000 Euros or more for luxury apartments and average prices at a very low level. Also, most of the buyers are now buying cheap apartments, so this also contributes to the data.

We (PMR) have a listing price index and for apartments in Plovdiv the average price in June was 700 Euros/sq.m. This shows exactly this gap - availability of apartments offered at 1000 Euros and such offered at 500 Euros gives us an average somewhere in between."

Here is the report:

The newest data of the National Statistics Institute (NSI) about the apartments in the big cities in Bulgaria in the second quarter of 2012 shows that for the first time since the beginning of the crisis there was a small positive price growth of 0.2% on a quarterly basis.

This confirms the recently released analysis of BULGARIAN PROPERTIES for the second quarter of 2012, according to which the property prices in Bulgaria have remained stable over the past few months and the process of stabilization of the Bulgarian property market, which started in the second half of 2011, continues.

Good news is that even the highest quarterly price drops are within 5% and prices in half of the biggest cities in Bulgaria have grown over the past quarter with between 0.5% and 3%.

On an annual basis (compared to 2Q 2011) prices of apartments have decreased by an average of -2.6%. The real drop in average apartment prices after inflation (calculated with the Harmonized Index of Consumer Prices HICP) is -0.11% compared to the previous quarter and -4.36% year-on-year (compared to the same quarter in 2011).

According to NSI data the average price of an apartment in Bulgaria’s regional cities in the second quarter of 2012 is 453 Euro per sq.m. (about 1 Euro more compared to the previous quarter) and prices in the capital Sofia are still the highest among the big cities.

The prices at which apartments in the big cities were sold in the second three months of 2012 are as follows:

• Sofia – 745 Euro/sq.m.

• Varna – 730 Euro/sq.m.

• Plovdiv – 486 Euro/sq.m.

• Bourgas – 588 Euro/sq.m.

• Stara Zagora – 454 Euro/sq.m.

• Rousse – 445 Euro/sq.m.

• Veliko Тarnovo – 364 Euro/sq.m.

In 2Q 2012 prices of apartments in Sofia have decreased by -0.54% compared to the previous quarter, as the drop year-on-year is -0.57%. After inflation prices of apartments in Sofia have dropped by -0.82% compared to the previous quarter and by -2.36% compared to the same period last year.

The accumulated nominal price drop of apartments in the regional cities in the last few years since the beginning of the crisis is -37.58%, as in Sofia the accumulated drop is -41%. The accumulated real decrease in prices since the beginning of the crisis is -42.87% on average for the country and -46% for Sofia.

The detailed data for of the changes in apartment prices in the big cities around the country in 2Q 2012 is as follows:

Nominal and real change of prices compared to the previous quarter:

• Sofia – nominal growth (-0.54%) and real growth (-0.82%)

• Varna – nominal growth (-0.69%) and real growth (-0.97%)

• Plovdiv – nominal growth (+2.66%) and real growth (+2.38%)

• Bourgas – nominal growth (-0.64%) and real growth (-0.66%)

• Stara Zagora – nominal growth (+1.41%) and real growth (+1.13%)

• Rousse – nominal growth (+1.1%) and real growth (+0.82%)

• Veliko Tarnovo – nominal growth (+3.11%) and real growth (+2.82%)

Nominal and real change of prices compared to the same quarter of the previous year

• Sofia – nominal growth (-0.57%) and real growth (-2.36%)

• Varna – nominal growth (-5.28%) and real growth (-6.99%)

• Plovdiv – nominal growth (-0.72%) and real growth (-2.5%)

• Bourgas – nominal growth (-1.02%) and real growth (-2.8%)

• Stara Zagora – nominal growth (+0.74%) and real growth (-1.08%)

• Rousse – nominal growth (-1.46%) and real growth (-3.23%)

• Veliko Tarnovo – nominal growth (-2.11%) and real growth (-3.87%)