Home Finance Gets Easier For Purchases Of Property In Bulgaria

It is thought that home loans for the purchase of property in Bulgaria will be made

easier to apply for and more will be granted, according to a piece in the Bulgarian daily newspaper Presa.

The leading newspaper in Bulgaria, The Sofia Echo, was just one of the many periodicals in the country to pick up the news that loans for real estate in Bulgaria are set to become even more accessible. "While sliding prices attracted buyers in 2009 and 2010, 2011 came with a special bonus - accessible housing loans, according to the daily, quoted by local news agency Focus." According to the report, the trend towards more accessible housing finance came when Bulgarian banks decided to relax the rules on the amount of down payment (or deposit) purchasers of property in Bulgaria had to pay.

The deposit is one of the most important factors for property buyers, especially in the current global economic climate when everyone has their eye on cashflow. People will still want to buy property in Bulgaria either for personal use or as an investment, but cutting the amount of deposit they have to pay for the property when applying for a mortgage in the country could well grease the wheels of the market at a time when its needed.

The Sofia Echo reports that "Currently, nearly all banks are ready to finance between 80 per cent and 90 per cent of the price of a residential property, provided it was a good building in a large city." Another factor which is likely to bolster the home loans market in Bulgaria is the fact that mortgage interest rates went down throughout 2011, nearly to the levels seen in 2007 before the global economic crisis took hold. "On mortgages in the european union, interest rates that were between 7.53 per cent and 7.93 per cent, were steadily hovering below eight per cent, which is comparable to the interest rates in the first half of 2008.

Mortgages in the local currency, the lev, are also close to being at record lows at 8.07 per cent, close to late 2007 figures."

Those wanting to sell property in Bulgaria will welcome the news that more people will be granted home loans, and indeed that more will apply for them given the easing of restrictions on down payment levels. More people with access to home finance means more buyers which means more chances to sell.

by: James P Martin

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