Bulgaria property news and articles

I have seen too many investors buy in Bulgaria just because someone tells them that its a good investment opportunity and they buy without having clear strategy or idea on what they want to achieve, dont know or forget the basic principles of Real Estate Investing and make mistakes.

It is good to understand that at this stage Bulgaria should not be seen as a quick return on investment, there are some exceptional offers that might provide you this but in general you invest in the opportunity, see it as a medium to long term investment. If you are able to look beyond the poor infrastructure and get excited from the opportunity to invest in a growing and developing economy stick around as you will learn how to get prepared for your Bulgarian property investment.

1. Bulgarian infrastructure is not as developed as you might be used to in Western Europe but this is where the opportunity is. Now with the EU accession there are number of infrastructural project and millions of EU money pouring into the country. Look beyond!

2. The property market is very dynamic don’t get fixated with what you see on the Internet in reality always looks different.

3.Learn as much as you can about the country, the economy, political system, geography, the law, the culture, the people – this should give you good understanding and reason why and how to invest in the country . Try to use independent and reputable sources of information not marketing products.

4.Have a clear strategy and plan how to accomplish it , set a budget and time limit and stick with them many properties in Bulgaria look cheap and it is tempting to overstretch you budget.

5. Be aware of the total cost fees, taxes, management cost, building works etc.

6. Have a realistic exit strategy make a good market research and consult with professionals.

7. Never ever sign anything until you are completely aware what it says and you agree.

8. Deal with reputable agents who understand what you want and have in depth understanding of Bulgarian market currently Real Estate Agent is a very popular profession and there are awfully a lot people that dont understand what they are doing. Be careful!

9. Bad title deeds- In 1992, it became apparent that the one of the biggest administrative barriers could be title registration. As a result of the neglected title registration system during 50 years of socialism, land records are often out of date. Some records are missing completely and this, combined with a mostly non-computerized system, can create a very confusing picture. Make sure you receive advice from the expert.

10. In Bulgaria there are such terms as “tax estimation price” and “purchase price”. The “tax estimation price” is for the purposes of real estate taxation and is much lower than the actual selling (purchase) price. Most of the Bulgarian property owners wish 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. You should know that having a Title Deed with lower price does not invalidate your deal. However, such a situation has its financial consequences, such as not having official documents for the money spent and higher taxes if you decide to sell the property afterwards on its real value. Please, consult with your agent on every aspect of the deal to avoid any misrepresentation and misunderstanding at a later stage.

11. The usual term for the owners of the property to move out of it after completion of the sale is one month. This could be negotiated if the buyers require a shorter term but it’s advisable to plan in advance.

12. Guaranteed rental income offers. There are some exceptional opportunities to obtain good returns on your investment in this way, but be sure to check that your guaranteed rental income is backed by a contract with a reputable tour operator, not simply an inflated purchase price to enable the developer to return “your own money” during the early years of your investment.

13. Building permissions for off-plan developments- make sure the developer has the necessary building permission and that the property specification is agreed in detail with the builder and that the property will be delivered to you complete with the necessary license to occupy it as a home. Ideally you should not pay the final installment of the price until this is produced.

14. During the viewing trip make a lot of pictures and notes. All properties at the end of the day may look the same.

15. If you want to demolish an existing property and build a new one you need a planning permission, however it can be waived if you only intend to repair the property. Make sure before committing renovations projects to consult with a builder and get the idea of the costs.

16. Do dont rush into decision; take your time to think this is your money and your investment make the most out of it.

Submitted by: Galina Mihaylova