Bulgaria has suffered a catastrophic drop in house prices this year (2009). The average price of dwellings has dropped from 1418 LEVs/per square metre (sq. m.) in Q3 2008, to 1075 LEVs/sq. m in Q2 2009.   However the Bulgarian LEV is pegged to the Euro, so dollar-based investors will not have done so poorly.

When prices rose in Bulgaria during the boom years, there was a significant decline in gross rental yields, a fact noticed by the Global Property Guide in early 2007. 

• In 2006, central Sofia yields were over 10%. 
• By 2007, yields of 7% were more typical.  
• By 2008, yields in central Sofia were under 5%. 

It is worrying that despite the significant drop in house prices, yields in central Sofia are down again this year – and are between 4.2% and 4.8%.  Suburban Sofia yields have also moved slightly down to 5.2 to 6%. 

Data is not available for ski resorts and the black sea coast, because rents for those types of units tend to be seasonal.

Bulgaria’s very low yields are an unhappy sign.  We urge investors and buyers to wait, till things get better.