A total of 25% of buyers currently searching for a residential property are interested exclusively in new construction. Another 50% of people prefer it, although they are also open to purchasing an apartment in an older building if the conditions are favorable. These are the results of the National Survey on Real Estate Market Attitudes, conducted by the companies within Realto Group, which generate the largest volume of housing transactions in Bulgaria.
"Several forecasts predicting a decline – in both prices and market activity – turned out to be not only inaccurate but entirely wrong. On the contrary, we are witnessing a market at its absolute peak, with a record number of transactions and no indications of a shift in this trend. At the same time, new construction is the main driver, especially in large cities. This prompted us to thoroughly examine the motives, needs, and profile of our clients. We initiated the National Survey in order to meet expectations and be as useful as possible to our partners, to help clients and investors align their perspectives and, in this way, contribute to a sustainable and predictable market," commented Yordan Angelov, CEO of Realto Group. He added: "We plan to make the survey an annual initiative in order to monitor changes in consumer behavior in both the short and long term."
According to the data, Sofia is understandably the main focal point for clients – 64% of respondents are interested in buying a property in the capital. It is followed by Varna, Plovdiv, and Burgas, with only 10% of survey participants expressing interest in purchasing outside the four major cities in the country. At the same time, those seeking property in the capital already live there, and migration to the city is mainly driven by people living in smaller regional and municipal centers.
Slightly over 70% of survey participants are looking for a home for personal use, while the remaining nearly 30% are clients with investment intentions.
"New construction generates strong investment expectations among clients. Half of the survey participants are looking for a property to rent out, and 33% plan to resell it with speculative intent. Only 18% of people aim to protect their money from inflation. This clearly shows that new construction is perceived as a real source of return, not just as an alternative to bank deposits," commented Vesela Ilieva, Deputy Chair of the Board of Directors of Realto Group and Managing Partner of Unique Estates | Christie’s International Real Estate, New Estates and SAVOIR | Unique Estates.
Clients have trust in the developers of new projects, the survey also shows. Over 60% of them are ready to conclude a deal before the usage permit is granted – 34% indicated readiness to sign a contract during the construction process, and another 28% – even before the start of the project.
Ownership of a home in a modern building is the main motive for 29% of respondents in Realto Group’s survey. They share that the depreciation and lack of effective maintenance make older buildings unattractive to them. Modern construction technologies and new building systems are the reason another 30% of respondents prefer a new building. Being the first occupants is a priority for 14% of survey participants. Around 9% of people stated they would find a better social environment in new buildings, and the expected more favorable prices are a motivation for 10% of clients.
The majority of new construction clients are looking for an apartment – 86%. Only 6% of respondents are looking for a house near the city, and 5% – a house within the city. Only 3% are interested in purchasing a vacation property.
However, the type of multifamily building clearly draws a dividing line among buyers. A small standalone boutique building is the preference of 61% of clients, while the remaining 39% would make a deal for a home located in a complex offering additional services and amenities. Large complexes are most preferred by buyers in the age group 25–35 – 53% of them are interested in exactly these.
Regardless of the building type, 79% of people consider a garage or parking space to be an important additional amenity. A maintained landscaped yard is the next most desired feature for survey participants – 52%. Security and video surveillance, as well as the presence of a children’s playground, are key for around 30% of new construction clients. The presence of smart systems is essential for 13% of respondents, with a much higher share of this preference among buyers aged 25 to 35. SPA or fitness facilities in the building are important for 11%, while a pool and reception area are not a priority – only 4% of respondents listed them as essential features of the property.
An area of up to 80 sq.m. – this is the preferred apartment size for 45% of buyers, while another 42% are interested in homes between 80 and 120 sq.m. At the same time, 53% of people are looking for a 3-room home, and 29% – a 2-room one.
"Statistics show demand for a size that suits both 2-room and 3-room homes. However, buyers clearly prefer 2 bedrooms. This means there will be increased interest in relatively compact 3-room apartments, and here, good and functional layouts in new projects will be key," says Gergana Tenekedjieva, CEO of ADDRESS Real Estate, part of Realto Group.
In terms of essential features of the home itself, the top preference among survey participants is a beautiful view – 55%. A large bedroom – over 15 sq.m. – is key for 48% of respondents, and a living room over 30 sq.m. is among the most fundamental property characteristics for 43% of people. More than one bathroom is important for 40% of respondents, and storage space – for 33%. Around 24% of people value large or French windows, and 18% – high ceilings. A walk-in closet is a key interior feature for 20% of respondents. 18% of survey participants value luxurious common areas.
Location is the most important criterion when choosing a new construction property, the statistics also show. A total of 38% of respondents cite the neighborhood as the most defining factor in their purchase. The price of the property ranks second, being a key factor for 32% of respondents. The third most important criterion is the quality of construction, which is decisive for 11% of people. The reputation of the investor ranks fourth among the main criteria of clients. It is followed by the availability of infrastructure, the area of the property, proximity to parks and schools. Sustainable environmental practices are not considered a lasting criterion by clients.
New construction in the center of Sofia is most desired – 12% of respondents include it among their options. The second most popular district is Mladost, of interest to 11% of clients. Manastirski Livadi, where the supply of new projects is also higher, is among the top choices of 10% of respondents. Interest in Ovcha Kupel is growing, with 9% of people listing it among their desired neighborhoods. The area’s popularity is increasing due to the emergence of many quality projects in recent years, and the fact that it already has established infrastructure and metro access. 7% of survey participants express interest in Krastova Vada and Hladilnika, and Boyana is the most desired neighborhood at the foot of Vitosha, followed by Bistritsa.
Low interest rates continue to be favorable for the market – about 74% of purchases are planned to be financed with a mortgage. Deals expected to be closed with available funds make up 26% – a share identical to that of investment-oriented buyers, according to Realto Group’s survey.