Amateur Real Estate in Bulgaria

It never fails to amaze me how many Brits come here thinking they can quite simply make a living by selling houses to other Brits.

Time and time again they start with the principle of by giving a professional service and not ripping them off with massive profits. They confess that they are not in it for the money but just to help other and make just enough to live on.

The countless number of people who have done this and failed is quite amazing and they still come. The is one very big reason they fail - there is not enough demand in the market. Bulgaria is swarming with so called Estate Agents from the mightily to the individual working through eBay auctions from their laptop in a bedsit in England. There just isn't enough business to go round.

This applies to most parts of Bulgaria, where are the tourist areas such as sea and ski resorts have been flooded with new property developments which have risen in price too quickly and now we find there is a glut that can't find buyers for love nor money. what's more there is now a growing resale market competing with new property which adds to the glut.

Then there are the 'away from the crowd' properties and from personal experience there is and always has been an uncountable figure of these types of properties for sale most of which aren't livable for many overseas clients.

To all these location in Bulgaria you need to add to this the fact that the pound has fallen, almost to devaluation levels, some 20% against the Bugarian leva and the 'credit crunch' in the UK there are no buyers coming over to buy nowadays. The current market for selling houses is probably the lowest since the 'boom started' You only have to look at the big established Estate Agents to find the barometer level of current business, they are all struggling.

There is another fact that many that come over here do so with one thing in mind, its cheap. They don't really like the country and it has lots of rough edges and massive complications to do with almost anything you want to do. Certainly the language is a tremendous barrier to most and to be quite honest many couldn't be bother to have a stab at it anyway. It is off putting trying to do anything here without a little foundation level with the language.

Market research is the main foundation a business is formed and entertained. If the idea of a business of selling houses to make a living here does go forward it can't be done without this and initial funding. Not least having had some form of training or experience in the housing market to draw upon, preferably in Bulgaria which is so different and to most other places.

Right from day one in the country I see expatriates thinking they have Internet connection they know many houses for sale and these are the only ingredients needed for a business. So they go ahead with the promise of cheap properties with an added promise of small fees for the service they provide - and fail miserably or at the very least continue to make no profit or plough money into a bottomless pit - another sign of bad business acumen.

The problem lies also with the fact that it isn't just the amateur entrepreneurs that suffer but many of the people who buy from them. So many things can go drastically wrong with deals with the property market here. As mentioned before, it is very different from anything most people expect and get back home.

Now I don't confess to be any kind of expert in the property market but I have had much experience in owning and running my own business and I have eyes and ears that take on what is happening here. It still is quite unbelievable that so many people have the same idea that is destine to fail even when giving advice telling then that - not just from me.

The draw of potential profit made from selling houses here is the the main attraction. It is quite feasible on the face of it to sell three or four houses a year and this would be enough to live on. Maybe so, but where are you going to get these buyers? How much money do you need to invest on advertising, transporting clients for house views, airport pick ups, arranging hotels/accommodation, detailed descriptions of the properties and not least a massive written up library of properties to choose from. These are just a few of the overheads where in the main you wouldn't get any return from them. Some folk just come here for the tour and pampering from Estate Agents without any intention of buying at your cost!

The language, (mentioned again) the conduct and Bulgarian ways from the vendors, bankers, solicitors, notary and various utility offices that business needs to cement itself to. The very idea that a Bulgarian company owns the property is a strong reason for many to not consider buying here at all.

What hasn't been mentioned too much about are the Bulgarians who want to sell their property where ever, in a city, a town or a village. It is very wise to think about the way they see things before entering into a buying contract or taking their property onto your books to sell. This indeed is another chapter that will be taken up at a later date.

The property market here is landmine for those who don't know much about it, so tread very carefully. this applies to those intending to set up an Estate Agent Business and the few who still want to buy here. The advantage is always going to be on the buyers side such is the current economic climate.

4 comments:

  1. Hi,
    I have also been amazed at the enthusiasm of British people to buy and then sell property in Bulgaria. My boyfriend is a lawyer and most of his clients right now are crowds of Brits trying to sue the developers for not fulfilling their promises. Most of them have been fooled about the property market down here and can't get their money back.
    I am ashamed that this is happening in my country because from the outside it looks like as of we are a crappy country cheaply selling its own land for little money , and on top of that, it's through deception!
    I find your blog very interesting because I have always wondered what motivates all these British families to come here and buy and sell property. Now I get their point although it still makes no sense to me.

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  2. In New Zealand, we have recently seen a TV programme about a British couple who buy a palace in Romania so I understand what you are saying. A programme like that would encourage people to do the same thing.
    The real estate industry in New Zealand is suffering badly at the moment and since it is the industry I am in, it is quite a worry.

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  3. I've been a realtor in America and the same experiences have happen here.

    People around the world want to make a fast buck and it doesn't work!

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