Bansko prices escalate as property stock levels diminish

One of the quirks of the Covid pandemic has been an upturn in domestic tourism, a trend reported throughout the world that has been a catalyst for domestic rediscovery. Sufficient volumes of Bulgarians have been lured to Bansko by its appealing prices and ease of access from Sofia; an affordable year round weekend destination much closer than alternatives on the Black Sea or in northern Greece. Domestic demand from Sofians fuelled by lending from their banks has consumed almost all available stock and set prices rising.

By how much are prices up?

Property stock that remained for years uninteresting to buyers has suddenly sold at asking price, as have offers in complexes with management problems, combative policies and uncompetitive maintenance rates. For the first time since the recession there is good news coming from Bansko and a glimmer of hope for all those who endured significant loses. Prices are not nearly what they once were before the recession but in many cases the achievable values are now 30% higher than two years ago, furthermore time on the market has been reduced by two thirds. Those who wish to sell now can without giving it away.

Nominally, the increase is less impressive as a change low to less low is of limited reward given the initial acquisition values, but the proven upward trend and the depletion of long standing stock throughout the marketplace is significant. Bansko was once an ocean of desperate vendors, yet today it offers slim pickings for serious buyers, all of whom will have to dig deeper to buy anything in 2021.

What about new stock?

We are far away from developers restarting or old unfinished projects completing, prices are still too much below build cost, as such existing property stock is the only likely source for buyers right now and for the foreseeable future. However, it is estimated that half of all British and Irish owners who bought in Bansko still own their properties, few of whom balance their annual costs, are satisfied with their returns or able to make good use of their properties themselves. Those who previously enquired about selling were largely deterred by low achievable values, unreconcilable loses or mortgage balances far in excess of their equity, but as prices creep upwards more will find selling a viable exit and thus will feed the market in the near future.

Where is the money coming from?

Economic measures by the European Central Bank to counter Covid-19 throughout the EU has flooded Bulgarian banks with surplus funds. This month two of the major Bulgarian banks joined three others in implementing negative interest rates (-0.7%) for balances over 200,000 Euros (costing the account holder 116 Euros / month). The banks simply do not want or need cash reserves right now and can afford to charge for the privilege of holding your money. Cash rich and seeking borrowers encourages holiday home buyers to take a mortgage, pay 132 Euros / month (on 30,000 Euros) and consider it equal expense to visiting a hotel for two nights a month.

Should you own a property in Bansko and considered selling previously, make fresh enquires as to your current value as you are likely to be pleasantly surprised.