With Property Prices Down Can You Still Profit?

With property prices right across Europe and further a field lower than they were a couple of years ago, (see Prices in Bulgaria down to 2007 level) does this mean that anyone needing to sell has to do so at a loss, or could you still break even or maybe manage a small profit from a sale, if you sell in today’s market.

Much depends on what you intend to do with the money received on a sale. And the currency used when you bought and when you sell.

So let’s look at an example. Say you purchased a property in Bulgaria for 15,000 Euros back in 2007 when you were maybe getting 1.40 Euros to the British Pound. The property therefore cost you around ₤10,700.  And then if renovation costs were a further 20,000 Euros, or ₤14,200, making a total spend of around 35,000 Euros or ₤25,000.

If you intend to sell the property now and take the money back into the UK, converting it to pounds, then to break even, you could actually list the property for sale at 28,000 Euros, less than the total Euros you spent on it two years ago and not lose anything. List at 35,000 Euros and you stand to make a profit of around ₤7,000.

If you are trying to sell your property in Bulgaria, or another country where transactions tend to happen in Euros, then this is something to keep in mind. And it will allow you to list your property at a lower price and thus attract more potential buyers.

Of course, this scenario does not help the likes of Irish investors or people living outside the UK and not intending to convert the sales proceeds into British pounds. But for most investors, now struggling to off load properties to free up some cash, this is certainly a positive factor and an advantage of the strong Euro.

For advice on the Bulgarian property market and good value properties in Bulgaria please visit http://www.thetravelbug.org