Buying property in Bulgaria?

Question

I am only considering for the time being, but is buying a property in Bulgaria a good idea? I'm thinking of buying a house or something for around £2000-£4000, something pretty run-down and renovating it to sell on for profit through a Bulgarian estate agent. Has anyone done this? What are the pros and cons? Would it sell quickly? Any other countries it would work better in?

Answer 1

As someone said above, I would be careful because of criminals etc.

You could maybe get a loan with your money as downpayment, as they have a very generous history with handing out with loans in european transition economies.

I don't know if it is legal to buy there as someone mentioned, but I know that the property market has been booming for many years, and that it is now going into freefall in similar economies in the baltics.

Albania could be a good alternative, as they have beautiful beaches and nature, and the risk is high due to political tention, leaving little presure on housing prices from outside investors. (criminals are a problem here to).

I would look at the OECD before I did something. they have extencive and smaller reports on many economies.

http://www.oecd.org/infobycountry/0,2981...

Answer 2

My wife's Bulgarian, and we've looked at buying land there recently. Our experience has been that the RE market is less transparent and liquid than in the US or UK, which makes it harder as a buyer to know if you are paying a fair price. Also, we've seen resort areas get overheated in recent years (Bankso and some coastal areas in particular) with a lot of developers relying on foreign investors to buy up inventory that would otherwise sit unoccupied if they had to rely on the domestic market.

We bought a condo a few years ago (just a shell without floors or fixtures) in my wife's hometown of Blagoevgrad for about 650 Euros/square meter, so I would be surprised if you found anything in the price range you quoted except raw land outside of a town.

That said, I do think there is potential to renovate properties and capture value on the resale. We're putting about 6,000 Euros into finishing out the condo and expect that to add 15-20,000 Euros to the resale value based on our discussions with other property owners and buyers.

Our condo purchase was arranged through a developer we personally know and trust. I would be more hesitant about working with an agent and contractor I had no prior relationship with.

If you're planning to finance the purchase, I would suggest using a Western bank that has an established presence in Bulgaria. Chances are, they won't sign off on the loan unless the deal passes their smell test, which helps you with your due diligence. They may also be able to assist you with the closing process and getting documents translated into English.

I hope this helps. Best of luck!

Answer 3

Reading at the other answers you would think Bulgaria is like a 3 world coutry - mafia, gangs etc everywhere.

You have to pay a visit to Bulgaria, decide on a region; think about the renovations - will you supervise them yourself or will you do it long-distance? I know people who have bought houses, renovated them and are now selling them for a lot of money.

Many people do not know that you can buy straight from the seller. If you do that, you pay the real price plus the expenses about the notary and the lawyer.

Don't forget that to be able to buy a property in Bulgaria, you have to register an Ltd company first. If you choose to buy an apartment, then that is not required.

Have a look at:

Answer 4

I am Bulgarian and my family was looking into investing in real estate since 2000. Although we bought some stuff and it prob appreciated quite well I would advise against it. The markets there are not well regulated, prices are subject to change and you dont know who is gonna pop up at what time to try to swindle you. We were looking at vast expanses of seaside land for sale on the Black Sea. However, we couldnt get a deal done with the criminals because if you gave them the asking price of lets say 100K, they will tell you its now 200K. If you had 200K they would make it 400K.

Its much easier to do business in developed Western countries, you may be paying a higher premium in terms of prices but every penny is worth it when you are dealing with a transparent market.

Answer 5

As far as I know (unless it has changed recently) you are not allowed to buy property in Bulgaria if you don't live there.  I know some-one who bought one and had to set up a Bulgarian Company and buy it through that. Check it with an estate agent.!

Answer 6

Lots of criminal gangs operate around the property markets so it can be dangerous, so be very carefull who you are dealing with over there. A guy I new considered it then thought better after he made a couple of visits and saw the amount of armed hoodlums involved in it.

Answer 7

Not at that price you won't

Bulgarian property is booming just now and prices are high.

The cons are that if you buy just to make profit, the Bulgarains won't be able to buy from you and you will be restricted to selling to people from other countries like yourself.

You are also going to have to check out the Bulgarian property tax situation and also the taxation paid by foreigners.

Your £2000-4000 is going to go in lawyers and taxation accountants fees before you have evn bought a property.