Rental yields

In Bulgaria the rent reimbursement from properties is exceptionally attractive – it is close to 12%. The annual reimbursement from real estate investment in Bulgaria is almost 5 times higher than in the UK, where it is 3.6% for the last months of 2005.

Bulgarian property market needs to develop in order for people to get the high rental returns. Also the investors are beginning to understand that low cost properties will not give your high returns and a more sensible level of investment is needed. For the investor adding property in Bulgaria to their portfolio is a good opportunity to diversify the risks and bring higher returns than in more mature real estate markets in a medium to long term.

The increased demand for properties is the reason for the rise of the rents. The last official statistics show that Bulgarian properties, both residential and commercial, bring 10-13% annual reimbursement from rent, depending on the characteristics and the location of the immovable. These numbers place Bulgaria in the lead in the whole of Central and Eastern Europe with regard to reimbursement coming from rent.

World Trade Organization:
In the year 2020 Bulgaria will welcome 12 millions tourists.
The reimbursement of the real estates’ net worth in Bulgaria is very high as well - for new high-end construction it reaches 30% a year. Some new developed real estates in Bulgaria as the apartments in Sunny Beach resort offer very promising perspective to long term returns on investment.

The next figure presents the cost of the retail rents in some major European cities, including Bulgaria’s capital Sofia, for 2004. The prices are in EUR/sq.m.

The next table summarizes the average prices of office rents in some European capital cities. The prices are per month with maintenance costs included.

City Basic rent
(EUR per sq.m)
Athens 20
Belgrade 22
Bratislava 13.5
Budapest 14
Bucharest 16
Warsaw 27
Prague 17.5
Sofia 13.5

Next are the industrial space rents for 2004 in different suburban areas in Bulgaria:

City Zone Price (EUR/sq.m)
Sofia Industrial area 1 2.5 – 5.5
Sofia Industrial area 2 2 – 3.2
Varna East 1.5 – 2.5
Varna West 1.5 – 2.5
Plovdiv North 1.5 – 2.5
Plovdiv South 1 – 2.5
Burgas North 1.5 – 3
Burgas South 1.5 – 3
 
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