Costs involved in buying property in Bulgaria

Preparing for the transaction

The first stage is choosing a suitable apartment. There is no need to rush – there are plenty of offers, and finding a suitable option is not that difficult.

Once the apartment has been chosen, it needs to be reserved by paying a deposit. As a rule, this is around 10% or a sum of between 2 and 4 thousand leva. If the transaction goes ahead, the buyer pays the remaining amount. If the transaction falls through due to the seller, the seller must return the deposit (and in some cases twice the amount, i.e. with a penalty). If the buyer withdraws, however, the entire sum stays with the seller.

It makes sense to check the property you are interested in before paying the deposit. You need to make sure the apartment is not pledged to a bank, that no third parties have claims to it, and so on. It is recommended not to limit yourself to an online reference from the Property Register, which is no guarantee that there are no encumbrances, but to go to the Registry Agency in person to carry out the check or to entrust this to a reliable representative.

When the deposit is paid, the transaction amount is fixed and can no longer be changed. At this stage a preliminary purchase agreement is signed, setting out in detail the subject of the transaction, the obligations and rights of the parties, and all other particulars.
Once all the documents have been prepared within the time limits specified in the preliminary agreement (usually one month, with penalties for delay), you can proceed directly to completing the transaction.

How the transaction works

A property purchase and sale transaction is executed before a notary at the location of the property. Foreign buyers must provide a passport and (if they have one) a Bulgarian residence permit card. Before the notarial deed is signed, the notary examines all the documents. The notary may also (but is not obliged to) check the safety of the transaction, in particular whether the apartment is pledged.

Payment is made by bank transfer after the notarial deed is signed, but before the notary registers the transaction and enters the data in the Register. Once the full amount has been received in the account, the seller confirms this to the notary, who then completes the transaction registration procedure.
After the parties sign the notarial deed, the notary certifies the document and sends it to the district court, where the documents are entered in the state Register. This process takes up to three days, after which the parties receive their copies of the notarial deed from the notary.

So there is no need to be surprised that after signing all the documents the buyer leaves the notary’s office empty-handed. The notary needs time to formalise the transaction, after which the ownership documents can be collected.
After receiving the notarial deed, the new owner must register with the Obshtina (municipality) and then change the details in the contracts with the water and electricity supply companies.

Costs

Three fees have to be paid when completing the transaction:

• The “такса за вписване”, i.e. the fee for entering the information in the Registry Agency’s register, amounts to about 0.1% of the transaction amount.
• The “местен данък”, i.e. the municipal tax. Its rate is set by the local municipality. For example, in Sofia, Burgas, Varna and Plovdiv it is 3%, in Ruse – 2.2%, in Stara Zagora – 2.5%.
• The “нотариална такса” — the fee for the notary’s services. The rates depend on the transaction amount. For example, if the value of the property is between 10 and 50 thousand leva, the notary fee will be 160,50 lv. + 0.8% of the amount exceeding 10 thousand leva.

All fees are calculated on the basis of the property value stated in the contract. If the value stated in the notarial deed is lower than the tax assessment, the value calculated by the tax authority is used.

To calculate the total amount of notary fees it is convenient to use special calculators, for example this one: https://www.calculator.bg/1/imoti_taksi_danatzi.html. You simply enter the transaction amount and the name of the Obshtina to get information about the notary fees. Keep in mind, however, that additional services may make the total costs higher. For example, paying the fees through a bank involves a small charge, and the notary will also charge an additional amount for drawing up the notarial deed (the main document certifying the transaction, which is usually prepared by lawyers).

Who pays?

Who pays the fees and charges when buying property depends on the arrangements between the buyer and the seller. For example, a common option is for all fees to be split equally. If the buyer is more interested in buying than the seller is in selling, or if the seller has given a good discount, the additional costs are usually borne by the buyer. Sometimes the buyer pays the municipal fee in full, while the other charges are split in half. Other arrangements are also possible depending on what the parties agree.

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Is there any risk in buying Bulgarian property from heirs?

Obtaining a long-term residence permit in Bulgaria on the basis of a property purchase