The first half of 2026 closed with the sharpest contraction in transaction volume since the pandemic — and with prices that nonetheless kept climbing. The two facts look contradictory, but they describe the same process: the market is coming down from an exceptional 2025 and returning to its normal rhythm.
This report brings together data from the Registry Agency, the National Statistical Institute (NSI), the Bulgarian National Bank (BNB) and Eurostat as of July 2026, and sets out what follows from it for anyone currently selling or buying.
According to the Registry Agency, 84,119 residential sales were completed nationwide in the first six months of 2026, against 101,154 in the same period of 2025 — a 17% decline. In the second quarter alone there were 45,965 transactions, 17.9% fewer year on year.
The figure sounds dramatic until you place it in context. In the first half of 2019 — the last "normal" year before the pandemic — the count was roughly 92,500. Through 2023–2024 the market ran at around 98,000 per half-year. So 2026 is not falling below its long-run base; it is returning to it after 2025 overshot substantially.
The reason 2025 was so strong is well understood: the approach of euro adoption on 1 January 2026 pulled decisions forward — both genuine household moves and speculative interest from flippers and short-hold investors. That speculative demand has now been spent. What remains are buyers with a real housing need: families moving to something larger or better.
This is the divergence that confuses people. According to NSI, the house price index in the first quarter of 2026 was 14.8% higher year on year and 6.2% higher than in the fourth quarter of 2025.
What matters is the pace, not the headline. 14.8% is the slowest annual increase since 2023 — for comparison, the first quarter of 2025 came in at 15.1%, and the year before at 16%. The curve is flattening, though it has not turned.
Eurostat data confirms the direction: in the first quarter of 2026 Bulgarian housing stood 9.4% above its 2025 full-year average, placing the country second in the EU for price growth behind Portugal (10.3%).
Quarter-on-quarter changes (Q1 2026 against Q4 2025), per NSI, show a clear split:
The four major markets continue to absorb most of the inbound demand and mortgage capital. In several smaller regional centres prices are already correcting. This is the first clear appearance of two different speeds inside one national index — and the reason headline figures for "the Bulgarian market" increasingly fail to describe any particular city.
The drop in transactions did not translate into falling prices largely because bank financing stayed abundant and cheap. Per BNB data, new housing loans extended between January and May 2026 were around 12% higher in volume than in the same period of 2025. The average interest rate at the end of May was 2.43%, with total cost of credit averaging 2.77% APR (indicative, as of May 2026).
A different figure is more telling: roughly 74% of transactions are now mortgage-financed, against about 60% a year earlier. That is not only a sign of accessible credit — it also reflects that at current price levels a growing share of households simply cannot buy without one. Relying on a bank is no longer the exception; it is the standard.
If a financed purchase is ahead of you, we cover lending conditions and the application process separately in our mortgage guide, published in this news section.
The most practical shift for anyone negotiating right now is this: according to agency data from Address, 54% of residential transactions close below the asking price, typically in the 2–10% range.
Discounts toward the upper end are achieved on properties that have sat on the market for a long time, or that were listed visibly above market from the outset. This follows directly from a thinner buyer pool: with one buyer per property, the negotiating position is no longer automatically the seller's, as it was through 2025.
For sellers the conclusion is concrete: accurate initial pricing now costs real money to get wrong. A property listed 10% above market on the assumption that the price can be trimmed later loses its first — and most active — weeks of interest, and usually sells for less than a correctly priced equivalent. This is why, for every property we take on, we run a comparative analysis based on completed transactions in the same area before agreeing a price with the client — not on competitors' asking prices.
While the mass market contracts, the top of the Sofia market is moving the other way. In the first half of 2026, transactions above €500,000 rose 31.6% year on year. By sub-segment:
The mid-market between €200,000 and €500,000 was essentially flat. The explanation is that buyers at the top rarely depend on mortgage credit or the rate cycle — for them property is a store of value, and eurozone membership removed the currency risk from that calculation.
The supply of completed new housing is falling markedly. Per NSI, 1,241 residential buildings containing 4,151 dwellings were brought into use in the first quarter of 2026 — around half the year-earlier figure. The largest volumes were in Sofia (968), Varna (672) and Plovdiv (516).
This matters for the medium-term picture. The supply of existing homes for sale has widened, as more owners came to market after euro adoption. But the flow of new homes is contracting — and that flow is what determines whether the next two years bring genuine downward pressure on prices in the major cities. For now, no such pressure is visible.
The market still favours the seller on price, but no longer on speed. In practice:
Your position is better than it has been for the past two years:
Market analysis is not a brochure we show at the first meeting. On every transaction we build a specific calculation for the specific property: completed sales in the same building, block and district over recent months; the gap between asking and achieved prices; realistic time to completion for comparable homes. That is the basis on which we agree a price with a seller or justify a buyer's offer. Document review, obtaining the required certificates and drafting the preliminary contract are likewise part of our standard scope, not a separate service.
The market is not collapsing — it is normalising. Transaction volumes have returned to 2019 levels, prices are still rising but more slowly, credit is widely available, and negotiating power has shifted back toward the buyer. This is a market in which the better-prepared side gains more than it did in 2025.
If you are selling and want a valuation based on completed transactions rather than asking prices — or buying and want to know whether a given price is defensible — call us or come into the office. We will look at the specific property and tell you what the numbers say about it.
Data as of July 2026, from official sources: NSI, the Registry Agency, BNB and Eurostat. Market indicators are indicative and change with each new quarter.
