Cold spell coming

The warm weather of the last several months of 2008 was in sharp contrast to a cooling-down house market. Vendors now have to cope rather with an altered attitude of buyers than with competition. Uncertainties about prices, employment and salaries made would-be purchasers more cautious, lengthened the period in which homes stay on the market and pulled the nerves of developers, who relied on off-plan sales to finance construction.
The iron business logic was what made developers be the first to succumb to the pressure. Irrespective of their sources of financing, they see no point in holding properties while paying staff, banks and subcontractors. Some of the large-scale companies sped up their bonus and discount scheme policies cutting off up to 15% of the initial asking prices and introducing extras such as free garages and deferred payments. The good news, however, is that these incentives prove to be successful and keep the market moving.
But there are already cases of direct reductions of prices for off-plan purchases. Apartments in one of the recently launched big developments in residential district Manastirski Livadi are offered for 750 euros a sq m. In the beginning of 2008, prices for similar properties started from 900 euros and often exceeded 1,000 euros per sq m.
No sharp fluctuations are seen in the resale market, but the sector can hardly form a trend due to the varied claims of sellers, mostly private persons. Mass prefabricated panel units, however, are often found at approximately 600 euros per sq m in residential districts like Lyulin and Ovcha Kupel.
The slowdown is seen in all bigger cities where property prices sky-rocketed in the past 2 years. In large residential areas in Burgas and Plovdiv prefab panel property prices usually vary between 500 and 600 euro per sq m, although there are exceptions.