Procedure for buying a property in Bulgaria
Bulgarian law allows foreign natural persons to buy property in the country but with a few limitations. If you have decided to buy an apartment (without being obliged to buy ideal part of the land on which the building is located) you will not come upon these limitations. Any foreign natural or legal person can become the owner of an apartment in Bulgaria. When buying a house one must know that land cannot be sold to foreign natural persons but can only be let long term, without a maximum term. In order to buy land in Bulgaria foreigners must register a company.
After you have made your choice the purchase process starts, as it consists of the following steps:
1. Apartments and flats are reserved. After the unit is selected as a rule the buyer has to pay a deposit in the amount of 1,000-2,000 EUR. 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 is signed within 30 days, as this agreement doesn’t need to be certified by a notary public. 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 owner 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 lawyers of BULGARIAN PROPERTIES enter the legal person-buyer of the property in the system of the Bulgarian National Statistic Institute. The property owner (legal person) will then receive a card with a unique BULSTAT number (ID number) under which it will organize all the issues related to the property. 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 taxes. The amount of the taxes does not depend on whether the owner is a legal or a natural person. There are usually two property taxes to be paid: one is a tax at 0.15 per cent on the declared purchase price of the property and the other a small levy for waste collection, although in some villages there’s no collection service and therefore no tax. You must pay both taxes (if applicable) at the municipal council offices.
Of course, the owners will have to pay their water, electricity and heat bills monthly. If they bought a property in a gated development they will also probably have to pay fees for security, maintenance, management, etc.
Renting the property out
Foreign apartment owners can also rent out their properties. Rental returns usually amount to 3-10% per annum. If the apartment is in a new development our partners from the leading property management company in Bulgaria Property Management BG can help you rent your property. |
