Sofia Europe's Costliest Capital for Residential Property

Sofia, Bucharest and Warsaw are the three most expensive capitals in Europe when measured by the ratio of how much the average resident earns versus the cost of housing, a survey shows.

The average yearly salary in Poland, Romania and Bulgaria is only sufficient to buy a mere one or two square meters in the respective centers of each of the three countries’ capital cities, according to data of the Polish real estate company Home Broker.

With the average yearly salary, a Bulgarian citizen can buy no more than 1.7 square meters in the center of the capital, the sales price being set at EUR 1759 per square meter, Home Broker data shows.

At the other end of the scale, according to Home Broker, are Brussels, Berlin and Vienna, where the average salary would be enough to afford a slightly more comfortable nine square meters.

Official data shows that the average asking sales prices for residential property in Bulgaria continued to fall, though slightly, in the second quarter of 2010.

Residential property recorded a negligible, average decrease of 0.8% for second quarter of the year after falling by 2.3% during the previous quarter, data of the statistics office shows.

The year-on-year comparison shows an average decrease of 9.7%. Prices fell by 7.8% on an annual basis in the first quarter of 2010.

The average market price of residential properties in Bulgaria is BGN 971.20 per square meter – the prices are the highest in the Black Sea capital Varna – BGN 1593.97 per square meter, followed by Sofia with BGN 1558.33 and Burgas with BGN 1231.33.

Local brokers have recently commented that the recovery of the real estate market in Bulgaria will not be as steady as initially expected, judging by the mixed signals that the market sent in the first quarter.

With the onset of the crisis, the activity on the market, which reached its peak in September 2007, dried up and many of the projects ended up frozen.

Buyers are unwilling to buy residential buildings, whose construction is not completed yet, which gives an advantage to the apartments on the so-called “second-hand market”.