How to buy property in Bulgaria
How to buy property legally in Bulgaria and what you should do if you things go wrong.
In November 2012 the Bulgarian government launched the Property in Bulgaria website, containing useful first-hand information on buying and selling property in Bulgaria and on property maintenance and the different fees and taxes involved. The website also offers a contact facility for answering inquiries from the public.
This guide is intended as practical advice which you should consider when purchasing property in Bulgaria.
Research property in Bulgaria
It is important to research thoroughly the area you are considering purchasing in, as well as companies you might use (developers, estate agents and lawyers). You should look at a range of properties with different agents to compare prices and ensure that you do not end up paying too much.
Exercise extreme caution if an estate agent, promoter or lawyer urges you to cut corners to save money or time. The Bulgarian property conveyance system is different to the one in the UK and you should ensure that those involved in the transaction are qualified professionals with expert knowledge of how the system works.
If you choose to work with a British estate agent, promoter or lawyer, check that they are qualified, reliable and have experience operating in Bulgaria It is also worth looking at online forums dedicated to Bulgarian property to learn from others’ experience and ask questions.
Seek independent legal advice
Numerous property owners are now experiencing problems with their property because they did not seek independent legal advice and instead used lawyers and translators which were recommended by the estate agent or developer and in some cases were acting for both parties. Appoint a lawyer who is experienced in property conveyance and fully independent of anyone else involved in the transaction, eg the estate agent, vendor or developer.
If your lawyer is based in Bulgaria, check that he/she is registered and practicing with the Bulgarian Bar Association by asking for their registration number and verifying this through the Bar Association’s website or the Bulgarian Bar Registers.
If you appoint a UK firm, check that they are registered with the Law Society in the UK and specialised in International Transactions.
Check that your UK lawyer has professional indemnity insurance. In Bulgaria there is no indemnity insurance.
Do not sign any papers or hand over any money until you have taken independent legal advice.
Although the British Embassy cannot recommend a lawyer, we do have lists of local English-speaking lawyers and qualified translators. Please note the disclaimers.
Use an independent translator
If you do not have a good understanding of Bulgarian, make sure that you get all contracts and relevant documentation translated by an independent translator. Make sure that any translations are true/legal. Please note that only the Bulgarian version of the contract is valid in a Bulgarian court.
Off-plan development in Bulgaria means property for which no Use permit (Act 16) is issued.
There are statutory stages of construction of an off-plan development which are certified by certain documents specified in the law. The most important documents are:
- planning permission/Visa for design (виза за проектиране) – it entitles the developer to prepare architectural design and construction plans for the development in accordance with certain statutory parameters for height of the building, density of the construction, layout of the building, etc.
- construction permit (разрешение за строеж) – it entitles the developer to start construction process as per the approved architectural, construction and other technical plans for the property
- opening of construction site and determining of construction line and level (Protocol for commencing of construction)
- certificate for completion and approval of rough construction (Act 14)
- certificate acknowledging the compliance of the construction with the statutory rules (Act 15)
- use permit (Act 16)
It is not advisable to buy off-plan development for which no construction permit is granted.
In practice, a usual transaction for buying off plan development has two stages: the signing of preliminary contract; and the signing of public deed before a Bulgarian Notary (Notary deed). The transfer of the property is made under the notary deed.
It is advisable the payment for the purchase of off plan property to be made in instalments each of which is made after the completion of the relevant construction stage and obtaining of statutory certification document.
As of January 2014 all restrictions on buying Bulgarian land by EU nationals have been lifted. If you need more information about the latest changes in legislation, please consult your legal adviser.
Before you complete your property purchase you should make sure you have seen:
- the Land Registry extract (кадастрална скица) which provides all the information on the land’s use, regulation (building restrictions) and structure.
- for the properties which are not included into the Cadastre Register (not available for all areas) a Municipality Sketch (регулационна скица) is issued.
- planning permission (виза за проектиране): you must ensure that when buying off-plan from a developer, the development has been approved from the local municipality (town hall). It is also worth having a look at the Urban Plan which will state whether or not the plot you wish to buy has any building restrictions, is in a green zone or includes a public pathway or similar
- the paid-up receipt for the previous owner’s annual property tax. It is also wise to make sure that there are no unpaid fees and taxes from previous years
- the Cadastral certificate giving the exact boundaries and square metres of your land
- the Use Permit (Act 16) which is issued by the town hall for new buildings or restructured ones and certifies that the property is habitable. You will need this document to connect to electricity and water companies.
- It is wise to require from the seller of the property to provide evidence for absence of any liabilities concerning the property (taxes and other statutory costs and fees) or its use (consumable expenses) Ask the property agent for information regarding any costs the owner has not paid. You should be aware that if you later find that there are any outstanding debts, as the new owner, you assume the debts for the current and previous year (two years in total). For this reason it is strongly advisable to ensure that you have a copy of an affirmation stating that the previous owner has no debts
- a property survey: this is not obligatory but it is wise to get a chartered surveyor (независим оценител) to check the property before you complete
- if you are buying an off-plan property, confirm that there is an architectural plan for the property approved by local municipality. Ensure that the developer/constructor has the necessary insurance to cover build defects.
- the preliminary contract – this contract is not obligatory but is usually signed between the buyer and the seller before the public deed is granted. You should make sure that you fully understand the contract before you sign it - if you are not fluent in Bulgarian you should get it translated
- the title deed – it is important to check that there is an accurate description of the property in the deeds
You should report the fraud by registering a complaint with the Bulgarian police or Regional Prosecutor’s Office.
Usually, in Bulgaria, property frauds fall under civil law and therefore are settled as private disputes held by a mediator or in court. If serious fiscal frauds have occurred (such as payments taken without receipts), the controversy is likely to fall under penal law. The Bulgarian police should deal with all fraud allegations once they are brought to their attention.
We have published advice on which UK authorities to contact if you think you have been a victim of property fraud.
While we hope that this information is useful, please be aware that it is not intended to be the only guidance for prospective buyers to follow when considering making a purchase. In addition, we make no representation as to the quality or accuracy of the information which is available at the web addresses listed in this guide, nor can we accept any responsibility for the content that is hosted on them. We strongly recommend that prospective buyers of property in Bulgaria seek independent legal and financial advice at all stages of their purchase.