World Library  
Flag as Inappropriate
Email this Article

Bulgarian property bubble

Article Id: WHEBN0020362545
Reproduction Date:

Title: Bulgarian property bubble  
Author: World Heritage Encyclopedia
Language: English
Subject: Economy of Bulgaria, Economic history of Bulgaria, Chinese property bubble (2005–11), Crime in Bulgaria, Education in Bulgaria
Collection:
Publisher: World Heritage Encyclopedia
Publication
Date:
 

Bulgarian property bubble

There were rumors and speculations regarding the existence of a property bubble in Bulgaria since at least 2006; however, many interested parties (especially banks) tended to discredit such a possibility. Most of all, since the property bubble has been the driving force in GDP growth in Bulgaria most players in the market, including government have been satisfied with the situation.

Dynamics

Provided that growth in GDP continued and that property prices had been sustained during the Financial crisis, there was a possibility that the growth of the bubble would return in late 2009, or early 2010. However since October, 2008 there has been sharp drop in the real estate market, including but not limited to:

  • lower number of property buyers
  • considerable drop in property prices
  • sharp decrease in property sales
  • many real estate companies have closed or temporary suspended operations

Among other reasons the current property bubble burst, there is the factor of increased interest rates and bank requirements to provide mortgages, which were part of the reason why the previous conditions of late 2005 and early 2006 had provided for easy access to loans for many Bulgarians. It may be accurate to say that the beginning of the bubble burst occurred somewhere around July-August 2008; however, the visible tipping point is October 2008. Analyzing several different sources, including media, several online portals and property experts, the burst was long expected, and the Global Financial crisis was only the catalyst of events, since most financial institutions in Bulgaria are foreign investments.

The contribution of foreign investment to the Bulgarian property market has been significant. In 2006, more than 29% of property deals were signed by foreigners, more than half of whom were UK citizens.[1] Various companies, such as Bulgarian Dreams, actively marketed Bulgarian[2] properties to buyers overseas.

References

  1. ^ http://www.propertywisebulgaria.com/article/brits-form-the-majority-of-bulgarias--foreign-property-buyers/id_347/catid_12
  2. ^ "Recent history of the Bulgarian residential property market". Global Property Guide. 
This article was sourced from Creative Commons Attribution-ShareAlike License; additional terms may apply. World Heritage Encyclopedia content is assembled from numerous content providers, Open Access Publishing, and in compliance with The Fair Access to Science and Technology Research Act (FASTR), Wikimedia Foundation, Inc., Public Library of Science, The Encyclopedia of Life, Open Book Publishers (OBP), PubMed, U.S. National Library of Medicine, National Center for Biotechnology Information, U.S. National Library of Medicine, National Institutes of Health (NIH), U.S. Department of Health & Human Services, and USA.gov, which sources content from all federal, state, local, tribal, and territorial government publication portals (.gov, .mil, .edu). Funding for USA.gov and content contributors is made possible from the U.S. Congress, E-Government Act of 2002.
 
Crowd sourced content that is contributed to World Heritage Encyclopedia is peer reviewed and edited by our editorial staff to ensure quality scholarly research articles.
 
By using this site, you agree to the Terms of Use and Privacy Policy. World Heritage Encyclopedia™ is a registered trademark of the World Public Library Association, a non-profit organization.
 



Copyright © World Library Foundation. All rights reserved. eBooks from World eBook Library are sponsored by the World Library Foundation,
a 501c(4) Member's Support Non-Profit Organization, and is NOT affiliated with any governmental agency or department.