Prices of the residential properties going down faster than the rents
2009-07-23 10:00 News from Novinite.com
The prices of the residential properties in Bulgaria are going down faster than the rents, so experts recommend buy to let. This is what the credit institution, Creditex, reported based on information provided by real estate agents, the Pari Daily announced.
According to Creditex experts, the co-relation between both prices is important reference point for the Bulgarian real estates market. The average current residential properties profitability is 4,5% in the first half of 2009, while in the last six months of 2008 it was 4,1%.
The redeemability of such investment is measure through the so called "gross rental multiplier". It shows the number of month rents, by which the investment will be returned. The lower the index is, the better the redeemability is, and the faster the investment will be returned.
The index for the first six months of 2009 is 209,4 months - a decrease from 237,3 months in the second half of 2008. The reasons for the increasing redeemability of residential properties are the lack of adequate financing from the financial institutions, which makes the prices go down, and the rise of the interest towards renting apartments, instead of buying them.
The increase of the current residential properties profitability since the beginning of 2009 shows that the most critical moment of the real estate crisis is may be passing, and the first signs of realties market recovery and stabilization are appearing, experts form Creditex commented...
This News is listed at news.Guide-Bulgaria.com
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