Procedure for buying property in Bulgaria
Buying property in Bulgaria is a simple and straightforward process. Bulgarian law allows foreign persons to buy property in the country but with some limitations. All foreign natural or legal persons can buy apartments in Bulgaria on their own names, provided that the apartments don't come with ideal parts of the land on which the apartments were built. Most of the apartments for sale in Bulgaria are sold without parts of the land, so we may say that in most of the cases you will be able to buy an apartment without any limitations. When buying a house with a garden or a plot of land, must know that generally land cannot be sold to foreign persons and can only be bought by registering a Bulgarian company. Important notice: Exceptions to this rule are now applicable to EU physical and legal persons. They are allowed to buy houses with gardens and regulated plots of land in Bulgaria on their own names as physical persons. The Treaty of Accession of Bulgaria to the EU allowed Bulgaria to keep the prohibition for EU physical and legal persons to buy land in Bulgaria for up to 5 years for land and up to 7 years for forests and agricultural land after its accession to the EU. The 5-year term has now finished and since 1/01/2012 all EU persons are allowed to buy land in Bulgaria. This applies to houses with gardens, all plots that are within the zoning of the settlements, apartments coming with ideal parts of the land, offices and other commercial properties. For buying agricultural land and forests EU persons still need to register companies in Bulgaria and these limitations will be valid till 1/01/2014. The same regulation applies for citizens of countries from the European Economic Area (EEA). For all other foreign persons, who are not citizens of EU or EEA countries, the overall restriction to buy land in Bulgaria is still valid, which means that they need to register a Bulgarian company. How to buy property in Bulgaria
1. To begin with, browse through our website and find the property which you like. After that contact us and will be advise you on any issue related to buying a property in Bulgaria and will tell you what you want to know about Bulgaria. All this will help you navigate through the great number of offers on the site.
2. Choose the date of your viewing trip to Bulgaria so that you can see the properties you chose. We are always ready to help you organize your trip to Bulgaria.
3. In Bulgaria you will be met by one of our agents who will organize you around the properties you wish to view, will answer all your questions and will help you choose.
After you have made your choice the purchase process starts. It consists of the following steps:
1. The chosen property needs to be reserved and taken off the market. After the property is selected as a rule the buyer has to pay a deposit in the amount of 10% of the agreed sales price. Only after that will the property be marked as reserved on the site and will be no longer available for sale.
2. After paying the deposit a preliminary agreement with the owner is signed within 30 days. The agreement settles the basic conditions which will later be copied to the Notary Deed. The conditions include a description of the property, the price, conditions and terms of payment, and for off-plan properties – the term for finishing the property.
3. Drawing up of the Notary Deed (same as Title Deed in the UK) which is considered the legal document certifying the ownership of the property. It is drawn up by the local notary public in the presence of the buyer and the seller.
4. The notary public certifies the deed and registers it with the Registry Agency. This is also noted in the notary deed.
5. Only for legal persons: a week after receiving the Notary Deed the certified lawyers enter the legal person - buyer of the property - in the system of the Bulgarian National Statistics Institute. The property owner (legal person) will then receive a card with a unique BULSTAT number (ID number) under which all issues related to the property will be accounted. Within a two-week period our lawyers will also register the property and its owner (the company) in the tax office. Annual tax on the property After buying a property in Bulgaria its owner must start paying annual property taxes. There are usually two property taxes to be paid: property tax and garbage collection, which are paid at the local municipality. Of course, the owners will have to pay their water, electricity and heat bills monthly. Renting the property out Foreign property owners can also rent out their properties. Rental returns usually annual amount is to 2-5%
• A municipality tax is calculated on the purchase price on the Title Deed and is similar to a stamp duty. This is determined by each City council and may vary between 2% and 3,5% of the price in the Title deed
• The notary fee is calculated using the price in the Title Deed. The following can be used as a guide: From €25,700 to €51,300 it is €180 + 0.2% of the amount over €25,700 Over €51,300 it is €230 + 0.1% of the amount over €51,300 but no more than €1550. These are added to the purchaser’s cost. Notary public in Bulgaria are tax registered and therefore calculate 20 % VAT over the above listed amounts.
• Land registry costs 0.1% of the value.
• After becoming the owner of an estate in Bulgaria, you also have to be BULSTAT registered. This is normally done by your solicitor as well/ and a special Declaration for obtaining real estate in Bulgaria has to be filled in and filed with the Tax authorities. This registration results in the issue of a BULSTAT card containing each buyer’s tax identity number.
Commission of 5% of selling price of the property you purchase, various fee for viewing trip which is refundable in full on the completion of sale.
Full checks on property (on ownership documents, land sketch, securing proper title deeds) - Organizing of a preliminary contract - Signing of final contract - Organizing the payment of property tax to the Tax authorities - Declaration of the purchased property in the Tax office - Translation into English We can also help you with hotel accommodation and airport pick-up if required.