BULGARIA

What do you need to know about buying property in Bulgaria?

Buying a property in Bulgaria is a fairly simple and straightforward experience. Foreigners can buy buildings, rights to build, and other land related rights such as the right of use & passage, but they cannot own land in the country directly.
Thus, for purchases of land, a foreign buyer must first set up a limited liability company in whose name the purchase can be made. Then this company can buy and own both the building and the land freehold for it. The restriction on land ownership may be revised now its in the EU (this will probably not happen for a number of years).
We offer full assistance with the formation of a company in Bulgaria. It is a routine operation which entails legal fees for setting up, government and solicitors fees totalling approximately 400 EUR (265 GBP). Upon forming the company, the owner will need to deposit 5000 leva (GBP 1730) into a Bulgarian Bank. This deposit can be withdrawn once the Ltd Co has been formed. An already formed limited company can own more than one property. We also offer peace of mind accounting services approx (100 leva) if the company is not trading.

Property buying process step by step:

      1. Browse our website, select the properties that interest you and communicate with our staff if you need guidance in your choice.
      2. Arrange your viewing trip, either yourself or with the help of our staff. Let us know your arrival date, any additional service you may require, and preferred dates for the viewings.
      3. If buying a property with land, set up a Bulgarian registered company in your name in order to own the freehold. This does not apply if buying a flat or off-plan for new built properties. Please contact us for detailed explanation and assistance with the process.
      4. Receive and sign a preliminary contract for your property, detailing your method of payment. If you need legal assistance, we could recommend an independent solicitor to advise you on your contract and to perform a detailed check of the property’s title documents, building permissions, debts on title, etc. 
      5. Finally, you (or your legal representative) will have to sign the Contract of Purchase /Notary Act/ which will officially transfer the property to you or company. At signing, a State Tax (Stamp Duty equivalent) and notary fees less than 3.5% of the purchase price are payable. Full property payment may also be expected please refer to your preliminary contract for payment details.

This stage completes the process and makes you the proud owner of your new Bulgarian property!

Please note that within 7 days of signing the title deed, the foreign buyer (if he/she is purchasing property as an individual buyer, not through a Bulgarian Limited Company) should register for statistical purposes at the local BULSTAT registry office. This registration is to identify the investor in front of the Bulgarian authorities. The buyer should also submit a tax registration form within 2 months after the acquisition.

Important notice:
All foreign buyers purchasing real estate property must be aware that in Bulgaria there are such terms as "tax estimation price" and "purchase price". The "tax estimation price" (similar to "ratable value" in UK) is for the purposes of real estate taxation and is often much lower than the actual selling (purchase) price. Most of the Bulgarian property owners (vendors) wish that the "tax estimation price" (ratable value) 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. This is because of various reasons and Bulgarian Properties Yambol is not responsible for it. Even if the property buyer wishes that the purchasing price is written in the property title deed we can not guarantee that this will be accepted by the vendor.  

SPAIN

The Purchase
Once you have decided to buy a property in Spain, you should use the following guidelines to complete your purchase:-

You should ask for details of the outgoing costs payable every year to maintain the property, namely the Annual Real Estate Tax (IBI), the community fees, the charges for rubbish collection, the water rates, the electricity charges and the Property Income and Wealth Tax, in respect of the property you wish to buy.

When you have made a decision as to the property you want to buy, you will be asked to make immediate payment of a reservation deposit, thereby ensuring that the property is not sold to another purchaser. You will then have a period of between 10 and 15 days to exchange contracts but, before doing so, you should seek proper legal advice.

Always consult a lawyer, we can advise you of a reputable one.

Prevention is always better than cure. From now on until and after completion of the purchase, the lawyer will take care and assist you in all the different steps involved in the transaction. There are many excellent English-speaking Spanish lawyers in Spain. Choosing the right lawyer is your guarantee that Spanish legal requirements are met, that the property is registered in the vendor's name and that it is free of any mortgages, charges, encumbrances, debts or other liabilities. Your lawyer will negotiate and discuss the purchase terms with the seller's lawyer. The terms should not be limited solely to price but should cover in detail all your requirements like the completion date, the form of payment...etc. Once you have appointed your chosen law firm they will explain the procedure involved in buying in Spain and the associated costs. The next step after paying the reservation deposit is to examine and witness the terms of purchase in writing. At this stage the lawyers will draw up the private contract. It is customary to pay a deposit of ten per cent of the price on exchange of contracts, which is not normally refundable if the purchaser defaults. Conversely, if the vendor fails to perform his obligations, you will be entitled to rescind the contract and claim damages. Before your lawyer exchanges contracts, he will have completed his searches and investigations in respect of the property.

Finally, on the day fixed for completion your lawyer will go to the Notary Public to sign the title deed, making the final payment to the vendor who will simultaneously pass over possession of the property to you, handing you the keys. At this stage the sale is completed. Immediately after completion, the notary will fax details of the title deed to the local land registry to inform them of the identity of the new owner, to prevent the property being sold twice. In this way the notary and the Land Registry act together to protect and guarantee your interests. You will then have to pay the relevant taxes and have the original title deed submitted to the Land Registry for registration of your title. Your lawyer can also arrange for the transfer to your name of utilities and services such as water and electricity and organise their payment through a local bank.

The purchase of the property will involve the following expenses.

Notary, who charges according to a fixed scale. His charges may range from €340 for a property price of €120.000 to €601 for a property price of €600.000.
Land Registry, as a rule of thumb, is 40% of what the notary charges.

All the above prices are approximate.

If you are buying a re-sale property you are obliged to pay Transfer Tax (ITP) at 7%.
If you are buying a new property or a property in the course of construction from a promoter, developer or habitual trader, then you should pay VAT (IVA) at 7% plus Stamp Duty at 1%.
The VAT (IVA) rate increases to 16% if you are purchasing plots of land, commercial premises or garage spaces.
Plusvalía is a tax levied by the local Town Hall based on the particular area where the property is located, on the surface area of the land, on the catastral value and on the date of the previous title deed. This tax may range from a few hundred euros to as much as several thousand euros on larger properties with a lot of land. By law the vendor is obliged to pay this tax but it is common practice for the parties to negotiate on who is to assume this liability.
Finally, bear in mind that your lawyer will charge fees for his professional services normally between 1% and 2% of the price plus VAT (currently at 16%).

All the above information is for guidance only and was correct at time of publishing, we take no responsibility for any increases or decreases in the above residual values, always consult a lawyer for the correct fees related to the property found.