Published on 31 December 2005 at 12:07 pm
Filed under: Europe:- Bulgaria Property Guides » Bulgaria Property Buying Process
Because Bulgaria is currently so popular with property investors the property buying process in Bulgaria is becoming simpler to navigate all the time. There are more people and companies available all the time in Bulgaria to offer assistance with establishing limited companies to purchase land for example, and basically the majority of estate agencies and property developers in Bulgaria have a fairly well proven process to assist the investor.
For those who would like to go it alone or at least have a fair understanding of the purchase process in Bulgaria here’s a guide to the property buying process for real estate investors in Bulgaria.
First things first you may already be aware that for a foreign investor to purchase anything other than an apartment in Bulgaria a limited company has to be established by the property investor. It is not possible for a foreign individual to buy land in Bulgaria and although this rule is set to change when Bulgaria joins the EU, in reality this situation is unlikely to change before 2010 at the earliest.
The first step in the property buying process in Bulgaria is actually finding the best investment property applicable to the specific investor’s requirements. Once a property has been found and a price agreed upon with the vendor a deposit is usually required to secure the property and take it off the market.
At this point a preliminary contract is also signed by the investor and the vendor. The holding deposit is non-refundable if the property buyer pulls out of the sale, if however the vendor withdraws from the sale or problems are found with the property or its title then the deposit is of course refundable. The preliminary contract states the terms of the sale and once it is signed all the legal searches and checks can be carried out by the property investor’s solicitor.
As with any property purchase it is imperative that a property investor in Bulgaria appoints an independent legal representative to assist with every aspect of the purchase process. In terms of the searches carried out on the property, checks are conducted on the legality of the title deed, building licenses and permissions associated with the property and vendor and whether there are any outstanding mortgages and debts against the property.
If the property the investor is purchasing is anything other than an apartment it will be at this stage that a limited company will be established. As stated there are many companies and people in Bulgaria who can help a property investor get this sorted out and the better estate agencies and layers will also be able to complete this part of the process on the investor’s behalf.
At the time of writing this article the minimum foundation capital for the establishment of a simple limited liability company is EUR 2,600. This money has to be deposited in a local bank account but can be withdrawn once the company has been established. The average price for the establishment of a limited company in Bulgaria at the moment is EUR 550.
As soon as the limited company is in place and all the searches and surveys have been conducted satisfactorily the next step is to sign the ‘Contract of Purchase’ or ‘Notary Act’. This is only signed once a property is completed therefore those buying off plan property in Bulgaria will have to wait until their house or apartment is completed before making an appointment with a local notary public for the signing of this final contract.
As soon as the Notary Act is signed the title deeds for the property are transferred into the property investor’s name and the remainder of the property price is of course due.
Europe:- Bulgaria Property Reports
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