Bulgaria’s Real Estate Market 2025: Growth, Yield & 2026 Euro Adoption

Key takeaways (AireVest view)

1. Bulgaria’s housing market is maturing, not “breaking.” 2025 was a high-velocity year, but the early 2026 story is about normalization and selectivity, not collapse.
2. Yields are still competitive by European standards - around ~4-5% gross in prime Bulgarian cities, but net returns depend heavily on costs, vacancy, and asset quality.
3. Performance will diverge more by city, neighborhood, and financing profile. The market is increasingly “two-speed”: prime urban micro-locations vs everything else.

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Introduction

If 2025 felt like a “now or never” year in Bulgarian residential real estate, that wasn’t an accident. The market was pulled forward by a rare cocktail (yummy!): low mortgage rates, strong wage growth, and a very human fear of missing out ahead of euro adoption.

Below, we break down what actually happened in 2025, what is likely to change in 2026, and how Bulgaria compares to other markets on yields, demographics, and fundamentals.

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Strong wages, strong credit, strong momentum

Bulgaria 2nd in the EU for house price growth.

We saw double-digit annual price growth across the four largest cities (Sofia, Plovdiv, Varna, Burgas) in early 2025, and notes Bulgaria ranked second in the European Union for house price growth over that period, outpaced only by Portugal.

Wages rose meaningfully, supporting demand, but not forever.

Nationally, Bulgaria’s average monthly wage reached BGN 2,572 in Q2 2025. Investor.bg also highlights the wage picture in the capital, noting Sofia’s average wage was close to BGN 3,500 (with annual growth in the low double-digits).

Mortgage growth was not a side story—it was the story.

By end-August 2025, housing loans in Bulgaria exceeded BGN 30.199 billion, up 27.4% year-on-year (BNB data reported by BTA). BNB commentary in 2025 also indicates housing loans were the main driver of household credit growth, with annual growth rates in the high-20% range during parts of 2024–2025.

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Stabilization or Euphoria? The Euro adoption

2025 is year where expectations around euro adoption and low mortgage rates “heated” the market, particularly in Sofia, kinda like “Buy now, think later…”

From our vantage point, the euro narrative has worked less like a guaranteed long-term fundamental shift and more like a behavioral accelerator:

• Buyers rushed to purchase to avoid future price rises and uncertainty.
• Some demand was “borrowed” from 2026, pulled forward into 2025.
• The market became more momentum-driven in micro-intervals.

That matters because a big part of 2026’s expected “calm” can simply be payback: fewer rushed transactions because many already happened. We are planning a separate article next that focuses exclusively on the Euro adoption in 2026.

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Bulgaria’s yields in global context: ~4-5% gross

AireVest investors often ask: “If Bulgaria’s yields are ~4–5% gross, how does that compare?” Here’s a clean benchmark using Global Property Guide’s cross-capital dataset.

Gross rental yields (selected cities / capitals)

City	Gross rental yield
London	5.41%
Paris	5.24%
New York	4.88%
Sofia	4.13%
Berlin	4.13%
Lisbon	3.82%

Source: Global Property Guide, 2026

So Bulgaria is not “yield-poor” … like at all! In fact, it often sits above many Western European prime markets. In fact, factoring the flat tax rate of 10% relative to the 20-40% tax in most Western countries, you’ve got yourself a winner in Europe for 2025.

Gross vs net yield

Sure, gross yield is a headline. Net yield is life.

Even in a relatively simple Bulgarian ownership structure, net yields are typically reduced by:

• Property management fees
• Maintenance / repairs / CapEx reserves
• Vacancy and tenant turnover costs
• Furnishing refresh (especially for short-stay / mid-stay strategies)
• Taxes and compliance (varies by rental type and structure)

So if you start around ~4–5% gross, you should be stress-testing outcomes where net yield is 2-3% percentage points lower, depending on the asset and strategy (long-term vs short-term vs hybrid).

AireVest rule of thumb: the “boring” properties often win long-run because they produce more stable net yield—less surprise maintenance, less vacancy volatility, fewer operational shocks.

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Macro baseline: Bulgaria’s growth is supportive (but don’t over-romanticize it)

GDP growth reached 3.2% year-on-year in Q3.

IMF country data also shows projected real GDP growth of ~3.0% in 2026.

This is supportive. But it doesn’t guarantee property outperformance. What it does do is reduce the probability of a sharp demand shock - assuming labor conditions remain stable.

If you’re focused on income (yield-first), prioritize proven demand micro-locations in Sofia / Varna / Plovdiv rather than “cheap” pricing stories. Underwrite net yield, not gross. Use conservative vacancy and maintenance assumptions. Don’t confuse “high rent” with “high return.” High purchase price can neutralize rent growth.

If you’re focused on growth (appreciation-first), in 2026, appreciation becomes more asset-specific. The market won’t lift everything. Prime, liquid, well-designed units should preserve value best. Avoid “pipeline risk” (areas with large competing supply and thin differentiation).

If you’re unsure, there’s always Airevest to support your investments in Bulgaria. Why? Because we do our due diligence … and we speak English.

The “So what?” in the story

Bulgaria’s housing market in 2025 wasn’t irrational, but it was accelerated. Wages grew, credit expanded fast, and euro expectations pulled demand forward. We expect stability, not another wave of a bullish market.

Interested in buying in Bulgaria? Join Airevest.

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