It's been all quiet on the notice boards so far with regard to the new offer in Sofia. What to people reckon to this one? It looks good to me in all kinds of ways, but I guess the 20-60-20 payment plan might be the deal breaker for a lot of people.

hi minsk, yes, I have the same opinion, all things are in place and looks perfect (mainly I like design, developer and construction time is great) but payment terms are the issue for me personally. In case they would be 20/80, it would be really perfect deal for me. For all my investments I have (as a rule of thumb) just 2 step payment schedule (initial deposit which can range from 10% to 25% - 25 % in case the deal is really perfect - and then the final payment using mortgage financing). This way I find it really confortable for me to manage my portfolio and also all eventual risks are very much reduced.

Hi Minsk and Marek, Also what is your view on page 29 on the investment report which predict the average property value at "375,553" within 5 years on completion? I would tend to believe that the maximum Property value for a project away from the city centre would be reached well before this.. Therefore the ROI looks very optimistic indeed..What is your opinion on this capital growth projection? Marg

Hi Guys, I am sure you appreciate we are offered a lot of deals throughout CEE and Sofia was no exception. We chose this deal as it stood out from the crowd and shows excellent potential. Property Secrets will only run a deal with stage payments if everything else about the deal is great and in this case it is. Because of acts 14, 15 and 16 BTL investment in Sofia will often have stage payments but with acts 15 and 16 being at the end of the build the hit isn’t so bad. The main payment is due during the summer of 2009, still giving you over 18 months of capital growth. I have visited this site and can tell you I was hugely impressed. If anyone would like to discuss the location, please feel free to contact me. Kind regards, Martin Grainger Head of Portfolio Development purchasesupport@propertysecrets.net

Hi everybody Can anybody confirm if you would be able to flip your unit before the second stage payment is due? Any views on this Chris

Hi Marg, I wouldn't pay too much attention to those predictions 5 years into the future. I think PS have underestimated growth in the past (particularly in Poland), and they are a bit bolder now. If apartments in Sofia got to £375k then surely we would be looking at a Moscow-style property bubble, but who knows? Suffice to say I would be very content with much less growth than that, and I am reasonably convinced that we are likely to see good growth in the next 2-3 years.

Martin, On the investment page it says that it is possible to get a mortgage for the 60% payament and just pay the interest on this until completion. Can you give more details of how this would work?

Hi Roger Good question – and on a wider scale, it’s important to understand the big picture if you’re considering this investment. In a nutshell, you draw down on your mortgage in June 09 (estimated) for the 60% and pay interest only until you pay the final 20% on completion in April 2010. You would then move to the normal capital repayment. Call Bulgarian Home Loans who are in the mortgage section of the Investment Report if you would like more details on this. To try and put this into top line numbers using approximate figures, if you were borrowing £50,000 the interest only payments would be around £265 a month, so less than £2,500 until completion. At 25% growth per annum, over the same 9 month period you’ll make around £16,000 capital growth on a £85,000 unit. Don’t forget that this deal is also 16% below market value and is probably the best development in the whole of Sofia. The demand from locals will be very strong once they see the quality of the development and its location. The commute to the city is quick and easy, plus you’re in lots of open space. Our advice is not to be put off by the payment terms – its way below market value and the location and quality of the development means we expect big things in terms of capital growth for this deal – especially given that its in a city that’s right at the bottom of the growth curve and predicted to grow strongly in 2008. The capital growth you’ll enjoy will far outway any interest only costs between the payments. I've personally been to the site and it is stunning. Hope this helps regards Tim

Thanks for explaining that, Tim Roger

Having spoken to a mortgage broker and looked at some products, the financing that can be obtained on this is for a repayment mortgage with redemption penalty of 4% for 3 years then 2% for term. It does have an interest only option for the 1st year. It works like this :- 60% act 14 6.65% 10% act 15 6.65% 10% act 16 6.65% After that 3.15% above european rate - currently about 7.15%.

Any further opinions? Any comments on the service charges for maintaining the pool etc?