Cash Dominates Bulgarian Property Deals, Despite Growing Mortgage Market

Over 70% of property transactions in Bulgaria over the last decade have been made in cash, according to recent statistical data. The market is seeing significant growth, with property prices rising by 6% since the start of 2025.

Official statistics from the Bulgarian National Bank reveal that only 27 out of every 100 real estate transactions are financed with mortgage loans, while the remainder are completed with cash. This stands in stark contrast to the European average, where between 80% and 90% of transactions involve credit, particularly in countries with lower income levels.

This trend persists despite a surge in mortgage lending, which rose by 30% in 2024, and a 16% increase in housing prices. Yordan Yordanov, managing director of one of Bulgaria’s largest brokerage firms, attributes the high rate of cash transactions to the prevalence of "gray" money within the Bulgarian economy. According to Yordanov, many people in the private sector live off unofficial income, and it is common for clients to purchase properties with substantial sums, sometimes as much as 200,000 to 300,000 euros.

The outlook for the market suggests continued growth, particularly after Bulgaria joins the eurozone, with an expected rise in foreign investment in the Bulgarian property market. Yordanov also notes that despite the cash-heavy transactions, mortgage financing can be a better financial choice. With inflation levels and mortgage rates in line, using a loan to buy property might be more profitable than paying in full with cash, as inflation effectively reduces the cost of the interest paid on the loan.