Decline in Real Estate Transactions in Bulgaria: Expert Predicts Price Correction in Coming Years

The Bulgarian real estate market is entering a new phase, where the number of transactions is decreasing at an accelerating pace, even though advertised prices do not yet show a significant decline. According to financial expert Max Baklayan, this is a signal that the long-term upward cycle in housing is coming to an end.

In the first quarter of 2026, real estate transactions in the country decreased by 15.5% compared to the previous year – from 45,144 to 38,154. In the second quarter, the decline deepened to 17.9%, with transactions shrinking from 56,010 to 45,965. The transaction volume is now 12.5% below the 2019 level.

Regional trends show a similar slowdown: in Sofia, the decline in the second quarter reached 16.7% (after 12.3% in the first quarter), while in Burgas, a decline of 23.7% was observed. In Plovdiv, the decrease is 6.7%, which is significantly higher compared to 2% at the beginning of the year.

Despite the market contraction, mortgage transactions are increasing by 5.5%. In Sofia, the share of credit-financed transactions reaches about 74% (compared to 60% a year ago), and in Plovdiv, the number of mortgages is growing by 13.8% to 1,679. According to Baklayan, this shows that the problem is no longer interest rates, but housing affordability.

"A market shift does not begin at the moment we see lower prices in advertisements. It begins when buyers pull back. The number of transactions is a leading indicator, and currently, its trajectory is clearly negative," Baklayan commented. He notes that the real correction is already happening during negotiations – in about 54% of transactions over the last six months, sellers have made a discount between 2% and 10%.

Parallel to the weakening demand, new construction continues to grow: in Sofia, new housing starts are increasing by 187%, and in Burgas by 115%. This is happening against the backdrop of NSI data showing that there are nearly 1.6 million uninhabited homes in Bulgaria (38.9% of the housing stock). Additional pressure on investors is created by rising production costs – between 2015 and 2025, producer prices in residential construction in Bulgaria jumped by 166%.

Max Baklayan predicts that in 2026, advertised prices will remain relatively resilient, but a more substantial correction could begin in 2027. In the period between 2027 and 2029, real estate prices could decrease nominally by between 20% and 30%. By 2030, the nominal decline could reach around 25%, with accumulated inflation potentially further reducing the real purchasing value of properties.