Not the most obvious urban destination for tourists, Sofia's profile has also suffered through the lack of a direct low-cost air service to and from London, but with EasyJet due to launch exactly this service in November, and Bulgaria now an EU member, Sofia looks capable of playing catch-up with its new European cousins. In this, it will be helped by its comparatively cheap property prices, low cost of living and the lowest rate of corporate tax in the EU (10 per cent) – factors that multinational corporations have not been slow to note. As a consequence, the demand for office space within Sofia is high, and this has led to residential properties rising in value as more willing workers – both Bulgarians and expats – head to the city.

So, where to invest? Whilst asserting that in Sofia's city centre the comparatively high price of apartments is offset by a strong rental market, Lance Nelson of Jet2Let Property also suggests looking beyond the city core. "You might check some of the good residential areas, like Lozenets and Iztok, both close to the centre. A savvy investor may also go for areas overlooked but still close to the centre, such as Lagera, a small neighbourhood area with many low-rise buildings. "Bulgarians refer to the 'Uzhni Rayoni' – the desirable southern region – and this takes in some excellent developments with fine views of Vitosha Mountain, such as Monastery Meadows and Embassy Suites – which are situated very close to Bulgaria Boulevard." This area, Nelson reports, is "rapidly being transformed," with offices and a new, large shopping mall, and has direct road and tram transport to the centre as well as being accessible from the southern ring road. Besides offering ease of access, Nelson adds that the such areas outside the CBD have another advantage: "As they are away from communist-era buildings they are proving to be popular with many Bulgarian buyers, who find the city centre polluted and unsuited to long-term living." Nelson also believes that Sofia Business Park and Vitosha have good potential, while Mladost "will benefit from the new underground extension station under construction there."

So, when investing in property in Sofia, small could well be beautiful.

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Article published November 2007