Real estate deals with mortgages are few in Bulgaria

In Bulgaria, most real estate transactions are made with own funds. Only 20% of Bulgarians buy  homes with a mortgage loan.

Officially, the share of purchases with mortgage loans in the country is around 20%, but for apartments and houses, it reaches 40%. This is according to statistics from the Registry Agency, and it represents only 1/5 of property purchases and sales in the country. The share of mortgages in Bulgaria appears even more surprisingly low compared to levels of around 80-90% in countries like Germany, the UK, and the USA.

Number of property transactions in Bulgaria with and without mortgage according to property type, in the third quarter of the respective year

• 2021 – Without mortgage – 14554, With mortgage – 7598
• 2022 – Without mortgage – 13014, With mortgage – 7298
• 2023 – Without mortgage – 10818, With mortgage – 7185

If the statistics are examined by city, the only city that is an exception is Sofia, where 60% of all transactions are with a loan. Nevertheless, transactions with own funds continue to prevail over those with loans, and this has been a stable trend over the past few years.

Real estate has always been the most popular asset for Bulgarians; it is a good way to preserve the value of their money. Compared to the situation 2-3 years ago, namely high inflation and low interest rates, the trend has intensified. Households with high incomes and savings are the main buyers in the market.

Bulgaria is among the countries where the majority of people (85%) live in their own homes, according to the latest Eurostat data for 2022. In comparison, in Germany, 47% of the population lives in  their own homes. In Bulgaria, the large share of owned properties, which are inherited or gifted from parents to children, shows that the housing stock as a whole is relatively evenly distributed among the population.