The capital of Bulgaria, it is situated in a valley in the western part of Bulgaria. At 550m above sea level it is the highest capital in Europe.

What's so special about it?

One of the oldest capital cities in Europe Sofia dates back to the 8th century BC.

Although it contains a very diverse society, politically it is relatively stable. The Bulgarian property boom is most evident in Sofia; a lack of quality housing has meant the city is undergoing a revamp and a lot of the large tower blocks are being replaced. Over the next two years, Bulgaria will receive 4.6bn from the EU. Already Sofia accounts for about 20% of property investment.

Best kept secrets Unemployment is lower in Sofia than the rest of Bulgaria. The Bulgarian labour and social department reports it to be 3.5% (national average is 9%). Sofia also has the second-highest number of spas in Europe.

Office space is currently in short supply, but a number of large companies such as CocaCola, Nokia, Siemens, Liebherr, Kraft, Nestle, American Standard, Philip Morris, Metro, Lindner, Praktiker and SAP have opened offices in Sofia. Irish investors have included the Quinlan Group, which has invested 90m in Sofia, Sean Quinn, who has spent 43m buying the Sofia Hilton Hotel and Denis O'Brien's Communicorp Media Group, which has bought interests in six Bulgarian radio stations.

What's the property market like?

"The property market is thriving as prices for residential real estate in Bulgaria's 28 biggest cities and towns grew by an average 9.3% in the first quarter of this year, according to data released on Monday 23 April 2007 by the country's National Statistics Institute (NSI), along with 20-25% plus figures per annum for the past few years in Sofia, " says Gus Worth, a former Irish journalist and currently editor-in chief of Business Spotlightmagazine in Bulgaria. Irish investors are now the sixth biggest in Bulgaria, Worth reports.

According to West Properties International (WPI), an Irish company which recently opened an office in Sofia, average prices per square metre in Sofia are between 1,200 and 1,800, and while there are properties for sale at a much lower cost, renovation costs would be prohibitive. They report that growth in the lower market has stabilised but that prices at the higher end are increasing at 15% per annum.

Bulgaria's lack of a tourism strategy is currently an area of much debate at the moment, said Geoffrey Keating, Irish ambassador to Bulgaria, at the opening of WPI's offices. He believes that "there has been rapid development and there are some areas of over-development but in some areas they have been well planned".

How do you go about buying property?

The Sofia Echo is the largest Englishspeaking newspaper and its bi-monthly PropertyWisemagazine covers property across Bulgaria. There are large agencies, such as Remax, Century 21 and ERA;

however property agents only account for 37% of sales in Bulgaria. With the large number of agents selling Bulgarian property, it is best to operate through accredited agents. At present, foreigners can only buy an apartment or house, but unless they are resident in Bulgaria they cannot buy freehold land until 2014. An alternative option is to set up a Bulgarian-registered company; this requires investing minimum capital of BGN 5,000 ( 2,605.38) and registering with the national social security institute and the local tax office.

According to Dominic Hicks, director of Westhill Investments, legal risks are still high and titles are hard to trace and confirm, mainly due to hang ups from the communist era. There has been a growth in the mortgage market, although rates are higher than in the rest of Europe.

Where are the best places to buy?

The two best areas to buy luxury apartments are Doctor's Garden and Lozenetz in the city centre, reports Gus Worth. For houses, Boyana, about a 15-minute drive towards the Vitosha mountain, is popular and not as expensive. Bulgaria Boulevard is an up-andcoming area with new residential developments, shopping malls, hotels and offices being built. Sofia's most expensive district for luxury living is Ivan Vazov, and Vitosha is where the majority of diplomatic staff live.

What's the rental market like?

Rental yields in the centre are about 10%10.8%, while the suburbs are a more conservative 7.7%-9.3%, according to data from the Global Property Guide. A developing trend has been for corporate rentals. Iris Trade Ltd, the rental partner of WPI, manages rental accommodation for companies such as Danone, Renault, Heineken, Coca Cola, Nissan, Lufthansa and the embassies of Israel, Italy, Denmark, Morocco, Kuwait and the UK.

"In recent years there has been a shortage of quality rental properties, with the consequence that rental income has been high, with rents of 1,000-1,500 per month for two-bed apartments and 2,000-3,000+ for three and four-beds, " says Gus Worth.

However Worth believes there are indications that the rental market is getting overheated and there are reports of apartments lying empty for months so rents may go down.

What's the resell market like?

While the resale market is good, the high number of new developments means that the prices for second-hand properties are usually lower than new builds as buyers seem to prefer them.

What type of property is available?

According to the Sofia Echo and the website Imoti. bg, data shows there has been an increase in demand for one-bed apartments in many districts and as a result their prices have gone up nearly 29% in the first quarter of 2007. While there are a lot of high-rise unattractive residential towers in Sofia, the city's chief architect reported that there are plans to replace these.

Average property prices?

Figures from the Global Property Guide estimate that in the city centre a 50sq m property costs from 57,500, while a 200sq m will cost from 240,000. Suburban apartments start at 38,500 for 50sq m and rise to 125,000 for three times that.

Suburban houses start from 296,000 for a 300sq m property.

What are the tax breaks with Ireland?

Foreigners pay income tax on rental income of 10%, while if you set up a company, corporate tax is 15%. Property tax is approximately 0.15%, capital gains tax is 15% and Vat is 20%. Ireland has had a double taxation agreement with Bulgaria since January 2001.

USEFUL CONTACTS

>> Irish embassy in Bulgaria: 003592-985 34 25;

info@embassyofireland. bg
>> Bulgarian embassy in Dublin: 01-660 3293; BulgarianEmbassyDublin@eircom. net
>> The Sofia Echo: www. sofiaecho. com
>> Property Wise Bulgaria: www. propertywisebulgaria. com
>> Tourist guide: www. tourism-bulgaria. com/ www. sofiabulgariatravel. com
>> The Economist (Bulgaria):www. economist. com/countries/Bulgaria/
>> Global Property Guide: www. globalpropertyguide. com
>> Business Spotlight magazine: www. economedia. bg
>> Federation of Overseas Property Developers, Agents and Consultants:0044-870 3501223; www. fopdac. com
>> Association of International Property Professionals: 0044-20 7409 7061; www. aipp. org. uk

FAST FACTS

Getting there: Czech Airlines fly to Sofia via Prague. Bulgaria Air, BA, Monarch and Wizz Air fly via the UK.
Area: 1,349sq km
Population: 1,246,791
Currency: Leva (1.00 BGN = 0.51)
Weather: Moderate continental climate with temperatures ranging from -3degreesC to 26degreesC Transport: Rail links are good, with a metro, eight railway stations and links to major cities. Buses are cheap. The airport, which recently got an overall, has flights to major cities. There are over 15,000 taxis.
Going out: Sofia has a lively night scene with many mehani [Bulgarian traditional taverns] and piano bars playing cheesy '80s rock. Nightclubs are in the centre and a popular haunt with foreigners is Apartamenta, a private club in a 19th century mansion. Flanagans is an Irish bar in the Radisson Hotel.

Eating out: Sofia is full of new restaurants, ranging from traditional cooking to high-class international or Mediterranean cuisine. Locals tend to eat late. Eating out is quite cheap and a good multi-course meal with wine may cost less than 10. The best restaurant is atop the 16th floor of the Kempinski Hotel, which has great views and service at reasonable prices.
Shopping: The city has large shopping centres, with designer boutiques and small street shops. Top brands are on Vitosha boulevard and prices are very competitive.