Market overview
Bulgarian property is gradually becoming one of Europe’s more popular holiday home destinations, appearing in TheMoveChannel.com’s monthly top 10 chart multiple times in 2012.The market has seen economic slumps in past years, but low prices have seen buyers descend in search of real estate bargains.The country’s improving infrastructure combined with a relatively stable economy attracts buyers from Russia and other non-EU countries.
The property market is heavily linked to its tourist industry: investors tend to focus on the rental opportunities available from the ski resorts of Bansko and Pamporovo as well as the summertime potential of property in Sunny Beach. Indeed, the Black Sea resort in Burgas accounts for 4 in10 searches for Bulgarian property on TheMoveChannel.com.
Average selling prices
£43,261
£50,475
£26,813
£32,538
36,010
The Selling Process
Marketing your property
The normal means of marketing a property in Bulgaria is via an estate agent who can also value your property. If you used an agent to buy your Bulgarian home, it could make sense to use the same one to sell it, as they will already know the property. Before you take on their services, you should check carefully what they will and will not do in terms of marketing and what they will charge as commission.
Legal Representation
It is always advisable to be assist by a legal representative when selling your realestate, ideally one who is both fluent in English and Bulgarian and aware of the legalprocesses in both countries. A reputable lawyer will represent your interests andoffer impartial legal advice. You will also need to seek advice on the internationaldimensions of the transaction and on the critical issue of UK taxation. If you are notintending to be in Bulgaria during the process, you will need to grant Power of Attorneyto your legal representative and the notary will have someone in his officeto sign on your behalf.
Preliminary Contract
The preliminary contract will be drawn up in Bulgarian. Some companies willprovide the preliminary contract in English (together with the Bulgarian version),which makes the whole process much easier. A contract that is only in English willnot be legally binding in Bulgaria – there must be a Bulgarian version, whether ornot this is translated into English or another language.
Cooling off period
By law, there is a seven-day cooling-off period, during which the buyer may withdrawfrom the purchase if he/she chooses.
Deposit
At the time of signing the preliminary contract the buyer will also generally beexpected to pay the owner a 10% deposit. It is not uncommon to agree to pay asmaller amount (around ¤1,000 to ¤2,000 is the norm) at the point of signing thecontract, with an agreement to settle the remainder of the deposit within 7-10days, to avoid the need to carry large sums of cash.At this stage, if the buyer pulls out of the deal, this deposit is non-refundable. Ifthe seller pulls out however, the deposit will be refunded to the buyer.The notary then verifies the identity of the buyer/seller in person at his office andauthenticates the preliminary contract and supporting documentation, includingany Power of Attorney documents.
Cooling off period
By law, there is a seven-day cooling-off period, during which the buyer may withdrawfrom the purchase if he/she chooses.
Completion
Ideally the seller will attend the signing of the final contract in person at thiscrucial stage, though it is possible through giving Power of Attorney to a trustedrepresentative (usually the seller’s lawyer) to avoid this.It is advisable to arrange for the final contract to be translated into English, as thiswill become the final binding legal contract, and the preliminary contract will nolonger be valid.It is vital to check the whole contract, verifying that all the details are correct. Youmust confirm before the Notary Public the agreement to buy the property. It isusual that the seller remains in the property for a few weeks after completion,though the sales contract may stipulate different terms. Ensure you know yourresponsibilities for moving out on time.
Land registry
After the balance has been transferred to the vendor and all fees and taxes havebeen paid, the deed of sale is registered at the Land Registry.
Selling Costs Checklist
Once you have met these costs, you have paid to sell your home
Estate agent fees – typically 2.5%-3% of the sales price. CGT – 10% of the profit from the sale. However, during the calendar year, if you have only sold one property in Bulgaria, the tax will not be enforced.
Photo:AJC1, JürgenBOT Yeliseev
