Property Management in Bulgaria. Management Company Services

Management company services — is it worthwhile for owners or not?

Investments in Bulgarian real estate are mostly made by buyers from the United Kingdom, Russia, Ukraine and Kazakhstan. Over the last few years, citizens of Europe and the USA have shown growing interest in Bulgarian property.

The trend is quite logical and is driven by objective factors: prices for country property have fallen to attractive levels.

About 90% of clients who are looking for good-value holiday property intend to use it for just a few weeks per season, and then rent it out through a management company.  The tasks of a management company (MC) include managing the rental and maintaining the condition of the property. A property management contract is signed between the MC and the owner, which sets out all the letting terms: management company services, obligations, fees, and so on.

Property management in Bulgaria is in demand not only in gated resort complexes, but also in the urban areas. The difference is that in the city there are both long-term and short-term rental services, whereas at the resort it is only during the season.

Pros and cons of letting property through a management company:

Advantages of letting through a management company:

• Passive income, which can be guaranteed.
• Saving time and resources.
• Control over the property in your absence.
• The return of your property in the same condition.

Disadvantages of letting through a management company:

• Payment of a fee, from 15 to 50% of the profit.

“Is it worth it, is it profitable to let property in Bulgaria?“ — this question is often asked by clients who are considering purchasing property in Bulgaria as a way of generating income.
The answer: „If your property is liquid and matches the price, place, quality and location — then it is an excellent investment and you can and should rent it out“.

You can rent it out either on your own or by using the services of a company.

Property management is a great responsibility. Buying a flat/house or villa in Bulgaria in order to take holidays there and let it out is possible, but there are important points that must be taken into account.

• Find out at what price you can let the property. Many people are misled by unrealistic expectations regarding the rental prices in the complex that they can achieve. Do not rely only on stories from friends; look in detail at prices for properties similar to the one you have decided to buy on the major rental platforms, such as booking.com, Airbnb, Arendoo.bg and others.
• Correctly calculate how much advertising the property will cost. Practice shows that achieving good prices and optimal occupancy is impossible without serious effort and considerable spending on advertising. Bear in mind that the serious platforms that actually generate bookings for your property are not at all cheap. For example, booking.com typically works for 15% of each booking, Airbnb varies between 12–17%, and arendoo.com works for at least 10% for individual owners.
• Correctly estimate the cost of accommodating tenants. Do not underestimate the cost of cleaning and changing the linen. Look into the options and cost of hiring a person or a company to carry out this activity. Our practice shows that many buyers completely ignore this cost, whereas in fact it is perhaps the most important factor in achieving a good income from letting the property.
• Do not forget to calculate the cost of maintaining the property itself. If you are buying property in a complex that offers additional amenities such as a swimming pool or spa, find out the maintenance costs and who actually services them. If maintenance of the property is entrusted to a management company, find out whether this company keeps the complex to a good standard.
• The cost of utilities — electricity, water, internet. These expenses can indeed be an unpleasant surprise. For example, heating with electricity at a winter resort, or using air conditioning to cool a top-floor flat without good insulation in summer, can lead to fairly hefty electricity bills.

After all of the above, another question immediately creeps in: „Is it possible to make money from letting resort/urban housing in Bulgaria through a management company or on your own?“

The answer: «It is clear that buying property is largely an emotional decision. Even professional real-estate investors, whose sole aim is high returns, cannot avoid the emotional factor when buying. Of course, there is nothing wrong with that, yet setting emotions aside and applying common sense when deciding on an investment will certainly help you profit from the property you acquire».

Bulgaria Avenue will be delighted to offer you the most favourable property management terms; we offer both short-term (per-night) and long-term letting — please get in touch, we are always glad to hear from you!