Basic Steps to Buying Property in Bulgaria

The property purchasing procedure in Bulgaria is a relatively straightforward process, and compared to a number of other countries is much faster.


If you are purchasing property with land, ie a house or villa you will be required to establish a local company in order to proceed.  The law states that at the moment foreigners are not permitted to buy land in Bulgaria.  The legal way around this is to register a local company and buy the land through your company.

Basic steps:

• J&JA will assist you to find the type of property you require (either by viewing tour or on line)
• Appoint your independent Bulgarian solicitor (we can recommend one if you do not know any)
• Pay a reservation fee of usually EUR1000-2000 to have your chosen property taken off the market for usually between 3 to 4 weeks (similar to "Sold Subject to Contract" in the UK; please note this fee is non-refundable)
• Pay reservation fee preferably to your solicitor's client bank account who will forward payment to developer
• Preliminary contract sent by your solicitor, read, understand and sign it
• Pay instalments as per the payment terms set out in your contract
• On completion of property pay final instalment and sign Notary Deed (often referred to as final contract) in front of a Notary Public to transfer the title of the property into your name and take ownership.  
• Please note that your solicitor can take ownership of your property if you are unable to be in the country at the time by act of Power of Attorney
• The new Title Deed is issued in around 14 days.

 Naturally there are extra costs involved when purchasing property in Bulgaria, which need to be noted:

• Lawyer – approx 500 Euros.
• The Notary fee and all other local taxes associated with your property purchase are approximately 3% of the sale price.  These taxes include:

                                 *Notary tax – which depends on the value of the property
                                 *Government Transfer tax - 2% of the cost of the property
                                 *Real Estate Register fee - 0.1% of the cost of the property

Important notice:
 
All foreign buyers purchasing real estate property should be aware that in Bulgaria there are terms such as "tax estimation price" and " actual purchase price" and it is important that you know the difference. The "tax estimation price" is for the purposes of real estate taxation and can be much lower than the actual selling (purchase) price. Many Bulgarian property owners (vendors) would prefer that the "tax estimation price" is written in the title deed, and not the selling (asking) price, which the buyers are paying, so due to this practice there might be discrepancies between the price you are paying and the price written in the title deed. This is SOLELY because of tax reasons and the fact that the Vendor will want to save on Capital Gains.   Many purchasers also prefer to transfer their properties on the tax estimation price, which keeps the transfer and other costs lower.
 
You should know that having a Title Deed with a lower price does not invalidate your deal.
 

It is important that you ask your lawyer to explain all aspects of the deal so as to avoid any misrepresentation and misunderstanding at a later stage.

Click here to read about reasons to invest in a Bulgarian property or you can enquire online for more information.