Booming Housing Market in Sofia: Prices Soar in First Quarter of 2024

dynamic. This is how one word describes the first quarter of 2024 on the housing market in Sofia. “We’ve seen one of the strongest quarters in the history of the housing market. This was also confirmed by the data of the Registration Agency, which showed an increase in the number of sales in the main urban markets. This year, the market moved into a higher gear. This was largely expected due to the still low interest rates on loans, growing incomes, the slowing of inflation and the rapid growth of property prices on the one hand, and how we would expect to accept the Eurozone on the other,” said Polina Stoykova, Executive Director of the BULGARIAN FUND.

“At the same time, this new animation contributed to the acceleration of price growth after a slowdown at the end of 2023. This is clearly visible in the main city market of Sofia, where growth at the end of 2023 was around 3% year-.” year-on-year, and 2024 starts with a growth of almost 7%,” she said.

There is still no sign of a slowdown in bank lending and interest rate hikes. This will encourage both those looking for their own home and those looking to get a second home or holiday home.

BNB data shows that the average interest rate on newly issued home loans in BGN was 2.54% in February, which is comparable to the rates from the beginning of 2023, and for euro loans it is even fall in the interest rate and it is already. under 3%. As a result, the number of loans granted continues to grow. The registered growth in the first two months of this year is almost 41% annually.

Two and three bedroom apartments are the most sought after and dominate the market. The share of two-room houses bought is 57%, and those with three rooms – 40%. There is a decline in the demand for large buildings, which appeared after the pandemic.

“Factors affecting the housing market continue to have a positive impact. Positive economic growth, low unemployment, income growth, low interest rates on mortgage loans – all this provides excellent conditions for investments in real estate,” said Stoikova.

The slowdown in inflation has also weakened its impact on the market, but has been replaced by fears and anxieties about our acceptance of the Eurozone and how this will affect property prices and people’s savings.

“All this leads us to think that demand will remain strong and, as a result, price increases will be slightly higher than the expected levels of 5-10%.” In general, however, the real estate market is still well balanced and provides opportunities to conclude good deals in 2024 as well,” the company concluded.

You can see detailed statistics on average real estate prices in Bulgaria by city and region HERE