Frequently Asked Questions about Bulgarian Properties

How do I purchase a property in Bulgaria?

Foreign nationals are allowed to purchase land in Bulgaria only though setting up a company. Foreign citizens are not allowed to purchase land in Bulgaria as a physical person. If you purchase a house you need to set up a

company in Bulgaria and we can assist with that. As the company will own the land and you own the company, this is just a legal work around.

The first step in the purchasing procedure is to pay a deposit of 10% of the purchase price of the property (in some special cases we require 15% deposit). Once we receive the deposit we sign a preliminary contract with the owners so we could guarantee the availability of the property for at least 30 days. Du

ring these 30 days we will have to register your limited company and prepare all the necessary papers for the deal. In order to start the registration procedure we require you to sign the papers that are necessary and to pay the amount of 600 euro, which is the cost for a company registration.

What is the legal treatment of foreign investors in Bulgaria?

Bulgaria has one of the most liberal foreign investment laws in the region regarding Bulgarian real estate. According to the Bulgarian Constitution and legislation, foreign persons and companies can invest in real estate in Bulgaria either personally or through a local legal entity. Generally speaking, foreigners as persons can acquire only buildings but not land. In order to obtain the ownership of land in Bulgaria all non residents should buy the property as a juridical person not as physical one, in other words, register a company on your name and buy the property trough it.

How can be established an enterprise with foreign investment in Bulgaria?

As far as Bulgarian houses, villas, apartments and limited ownership rights (the right of use, the right to build a house, etc.) are concerned, you can directly purchase them as a person.

When talking about Bulgarian real estate with land, you need to set up a company that will be the owner of the property. Setting up a company in Bulgaria is relatively easy. All you need is a good solicitor or barrister at law. There are other ways to do it, like:

    * Establishing a joint venture with existing local companies;

    * Setting up a new venture;

    * Acquiring a company through privatization;

Which are the preferred types of business organizations with foreign investment?

The most common form of organization for foreign investors is a limited liability company. Other types are general partnership, limited partnership, joint-stock company, sole proprietorship, joint venture, branch, holding, cooperatives, representative office. Limited liability companies, unlimited partnerships, public limited companies, limited partnerships, holdings and cooperatives are legal entities. Branches and representations are not independent legal entities: branches may engage in economic activities, they have their own property and compile a separate balance sheet; representations may not engage in economic activities.

Is the extent or amount of foreign participation in companies limited?

No, it is unlimited.

Can foreigners acquire ownership rights over land in Bulgaria?

Foreign individuals can not own land (this is a Constitutional prohibition). However, the Foreign Investment Law removed the restrictions on acquisition of land by locally-registered companies with foreign participation. By setting up or joining a company incorporated under the Bulgarian legislation foreign persons can acquire full land ownership rights including ownership rights on agricultural land.

What are the living costs in Bulgaria? How much one pays for house insurance, gas, electricity, local and national taxes, to drive a car?

It's not possible to compare living costs in Bulgaria and Western Europe. Living costs in Bulgaria are extremely low! For example the food is generally twice cheaper than UK. House insurance: around 100-200 EURO per year depending on the type of house, together with the belongings and furniture inside. For a property of price 30,000 EURO insurance against theft, flood and fire costs about 125 EURO per year with a decent insurance company. Gas: the gas system network is not developed in Bulgaria yet. People here mostly use electricity to cook. For heating: there are central heating systems in the big cities: monthly costs for a 2-bedroom apartment around 120 EURO. In the small places people use charcoal and wood, which is even cheaper way to heat a house. For electricity, when used for cooking, light or hot water one pays about 30 EURO per month. Local and national taxes for owning a property: depending on the place where the property is located, the most expensive area is the capital Sofia, where the annual taxes of 2 bedroom apartment are around 150 EURO per year, but the rest of the country is around 80 EURO per year.

Driving a car in Bulgaria: There are few annual fees that must be paid every year to drive a car in our country:

    * Driver responsibility insurance: 35 EURO per year

    * Road tax (depending on the engine power): around 55 EURO per year for a car of 2000 cc sm. engine.

    * MOT: 12 EURO per year

Fuel prices: petrol: 0.85 EURO/L, diesel: 0.75 EURO/L, LPG: only 0.50 euro/l. Most of the cars in Bulgaria are equipped with LPG systems, so cars are mostly fueled with the non-pollutant and very cheap propane gas. There are many petrol stations everywhere, many garages to service the cars (very cheap though). The insurance for a brand new car is around 800-1500 EURO per year, depending on the price of the car.

What about Notary?

 A notary is responsible for drawing up the purchase contract. The notary will require proof that you are buying an unencumbered property and that you have funds to do so. He will require proof of ownership from the seller, a declaration from the seller that they have paid all the obligations to the state, a certificate showing the tax authorities evaluation of the property. Both the seller and the buyer must make declarations of their civil, family, and property status.

  On the day of purchase the notary registers the notary deed in the regional courts register of immovable properties.

Is it necessary to come in Bulgaria to purchase a property there?

 If you decide not to leave your country and you want us to purchase your property and set up a company on your behalf then we need: a copy of your passport, your full address, the chosen name for your company, 10% deposit for the property, 3% our company commission, the share capital of 5,000.00 BGN and 500.00 EURO (company set up fee).

Is the deposit refundable if the buyer desists from purchasing?

 Unfortunately we cannot offer a refund if you decide not to purchase a certain property as the deposit will have already been paid to the vendor to secure the property. If the vendor pulls out of the deal you can transfer the deposit to purchase another property offered by us. Our commission is non refundable.

Could you help me if I want to renovate the property or to build a house?

 We work at a fine quality and very reasonable prices. We have building teams on the territory of the whole country and it will be our pleasure to assist you to build your new house. We work with one of the best specialists in the country. They can build any type of house you want. We can prepare architectural plans, and make all the necessary calculations for you. Then we can build the house fully corresponding to your requirements and preferences. If you buy resale property we will help you to renovate and furnished it.

What is the local feeling towards foreigners owing property?

 The MyBgProperties are very happy to see people bringing wealth and foreign investment to their communities. Obviously it is very important to try and be friendly and fit in with the local community.