Authored by the expert who managed and guided the team behind the Bulgaria Property Pack
Everything you need to know before buying real estate is included in our Bulgaria Property Pack
Buying property in Bulgaria presents significant financial and legal risks that many foreign buyers underestimate.
Hidden costs can add 6-12% to your purchase price, foreign ownership restrictions apply to land purchases, and property scams targeting international buyers remain common throughout Bulgaria's major cities and resort areas.
If you want to go deeper, you can check our pack of documents related to the real estate market in Bulgaria, based on reliable facts and data, not opinions or rumors.
Foreign buyers in Bulgaria face transaction costs of 6-12% of property value, including notary fees up to €3,000, transfer taxes of 2-3%, and agent commissions averaging 3%.
Non-EU foreigners cannot directly own land and must establish Bulgarian companies, while common scams include properties without proper permits and undisclosed encumbrances.
| Risk Category | Cost/Impact | Key Considerations |
|---|---|---|
| Hidden Transaction Costs | 6-12% of property value | Notary fees, transfer taxes, legal fees, agent commissions |
| Ownership Restrictions | Company setup required | Non-EU foreigners cannot own land directly |
| Annual Property Taxes | 0.1-0.45% of cadastral value | Plus maintenance fees €5-15/m²/year |
| Common Scams | Total investment loss | Missing Act 16 permits, undisclosed debts |
| Market Volatility | 20-30% price drops possible | Especially in resort and rural areas |
| Rental Income Tax | 10% flat rate | Plus registration and compliance costs |
| Financing Limitations | 30-50% down payment | Interest rates 4-7% for foreigners |
Fact-checked and reviewed by our local expert
Yeheli Samuels 🇧🇬🇮🇱
CEO and Founder, Dira Bulgarit - Israeli real estate in Bulgaria
What hidden costs and taxes should I budget for when buying property in Bulgaria?
As of September 2025, hidden costs in Bulgaria's property market typically add 6-12% to your purchase price beyond the advertised property value.
Notary fees range from 0.1% to 1.5% of the property's market or cadastral value (whichever is higher), with a maximum cap of approximately €3,000 plus fixed administrative fees of around €100. Property transfer taxes imposed by municipalities usually cost 2-3% of the cadastral value, which can be significantly lower than market value.
Registry and cadastre fees add another 0.1% of property value, typically under €250, while legal fees for independent property checks range from €500 to €2,000. Estate agent commissions in Bulgaria commonly range from 2.5% to 6%, with 3% being the standard rate most buyers pay.
Additional costs include company setup fees if you're a non-EU foreigner buying land, document translation and apostille services, surveyor fees, and international money transfer costs of 1-3%. These combined expenses can significantly impact your total investment, making proper budgeting essential before committing to any Bulgarian property purchase.
Who pays the notary fees, legal fees, and agent commissions in Bulgaria?
In Bulgaria's property market, buyers bear the responsibility for nearly all transaction-related fees and costs.
Notary fees, registration fees, and property transfer taxes are almost always paid by the buyer as standard practice. This differs from some other European markets where costs might be shared between parties.
Estate agent commissions are typically paid by the buyer, though this arrangement is technically negotiable and depends on the specific contract terms agreed upon. Most Bulgarian real estate agencies structure their commission payments to come from buyers rather than sellers.
Legal fees for independent property verification and conveyancing services are invariably paid by the buyer. Since Bulgarian law doesn't require you to use the seller's recommended lawyer, hiring your own legal representation protects your interests but adds to your total costs.
It's something we develop in our Bulgaria property pack.
What annual property taxes and maintenance fees will I face after purchase?
Annual property taxes in Bulgaria range from 0.1% to 0.45% of the cadastral value, not the market value, which typically results in relatively low annual tax obligations compared to Western European countries.
| Annual Cost Type | Typical Range | Payment Frequency |
|---|---|---|
| Property Tax | 0.1-0.45% of cadastral value | Annual |
| Waste Collection Fee | €15-€50 | Annual |
| Complex Maintenance (Apartments) | €5-€15 per m² | Annual |
| Utilities (Electricity, Water, Gas) | €60-€150 | Monthly |
| Building Insurance | €100-€300 | Annual |
| Municipal Services | €20-€80 | Annual |
| Communal Heating (if applicable) | €200-€500 | Annual |
For apartments in residential complexes, expect maintenance fees of €5-€15 per square meter annually, covering common area upkeep, security, and building management. Utility costs typically range from €60-€150 monthly depending on property size and personal usage patterns.
Are there ownership restrictions for foreigners buying property in Bulgaria?
Bulgaria imposes different ownership rules for apartments versus land, creating significant restrictions for non-EU foreign buyers.
EU citizens and Bulgarian nationals can freely purchase both apartments and land throughout Bulgaria without restrictions. Non-EU foreigners can buy apartments and buildings directly but face strict limitations on land ownership.
Non-EU foreigners cannot directly own land in Bulgaria and must establish a Bulgarian limited liability company (EOOD or OOD) to legally purchase properties that include land rights. This company setup adds legal complexity, ongoing compliance requirements, and additional annual costs for company maintenance and accounting.
The company formation process typically costs €1,000-€3,000 initially, with annual maintenance fees of €500-€1,500 for accounting, annual returns, and legal compliance. This indirect ownership structure remains the only legal pathway for non-EU citizens to acquire land or houses with gardens in Bulgaria.
What legal checks should I do to verify the seller owns the property and there are no debts?
Comprehensive due diligence through an independent Bulgarian lawyer is essential to verify clean ownership and identify potential encumbrances on any Bulgarian property.
1. **Property Register Extract**: Obtain a current extract from the Bulgarian Property Register showing current ownership, any mortgages, liens, or legal encumbrances on the property. 2. **Tax Clearance Verification**: Confirm all property taxes, municipal fees, and utility bills are current with no outstanding debts that could transfer to the new owner. 3. **Ownership Chain Verification**: Review the complete ownership history to ensure legitimate transfers and identify any inheritance disputes or family claims on the property. 4. **Court Records Check**: Search local court records for any ongoing litigation, bankruptcy proceedings, or legal disputes involving the property or current owner. 5. **Municipal Compliance Check**: Verify the property complies with all local zoning regulations and building codes, with no violation notices or pending enforcement actions. 6. **Power of Attorney Validation**: If the seller uses a power of attorney, verify its authenticity, current validity, and proper notarization to prevent fraud. 7. **Identity and Financial Verification**: Confirm the seller's identity through official documents and verify their legal capacity to sell the property.How can I verify the property has all required permits and proper registration?
Act 16 (final occupation permit) represents the most critical document confirming a Bulgarian property's legal status and occupancy rights.
Properties without Act 16 cannot be legally occupied, insured, or easily sold, making this document verification absolutely essential before purchase. Request to see the original Act 16 certificate and verify its authenticity with the local municipality's building department.
Check the cadastral registration to ensure the property boundaries, size, and classification match the actual property and sale documents. Verify all utility connections (electricity, water, gas, sewage) are properly installed and registered with respective service providers.
For new construction or renovated properties, confirm Act 15 (building completion permit) preceded the Act 16, and all construction followed approved architectural plans. Ensure building permits cover any additions, modifications, or structural changes made to the original approved design.
It's something we develop in our Bulgaria property pack.
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What are the most common property scams targeting foreign buyers in Bulgaria?
Missing Act 16 permits represent the most widespread scam affecting foreign property buyers in Bulgaria, where sellers market properties that cannot be legally occupied or insured.
1. **"Tolerance" Status Properties**: Illegal buildings or unauthorized modifications sold as legitimate properties, creating insurance problems and resale difficulties. 2. **Hidden Encumbrance Scams**: Properties sold with undisclosed mortgages, tax debts, or liens that legally transfer to the new buyer upon purchase. 3. **Power of Attorney Fraud**: Fake, revoked, or duplicate powers of attorney used to sell properties without legitimate owner consent. 4. **Garage and Parking Exclusions**: Essential parking spaces or garages excluded from the sale contract at the last minute, forcing additional unexpected payments. 5. **VAT Surprise Additions**: Undisclosed VAT charges appearing after deposit payment, particularly common with new construction projects. 6. **Off-Plan Construction Fraud**: Developers collecting large upfront payments for projects that never receive proper building permits or completion certificates. 7. **Rural Property Title Issues**: Properties in villages with unclear ownership boundaries or inherited family disputes affecting clear title transfer.What financing options are available for foreigners, and what are the requirements?
Bulgarian banks offer mortgage financing to foreign buyers but with stricter requirements and higher costs compared to local borrowers.
Loan-to-value ratios for foreigners typically range from 50% to 70%, requiring down payments of 30-50% of the property's appraised value. Interest rates for foreign borrowers average 4-7% annually, depending on the bank, loan term, and borrower's financial profile.
Banks require comprehensive income documentation, including employment contracts, tax returns, bank statements for 6-12 months, and proof of existing assets. EU citizens generally receive more favorable terms than non-EU applicants, who face additional documentation and verification requirements.
Popular banks offering foreign mortgages include UniCredit Bulbank, DSK Bank, and First Investment Bank, each with specific lending criteria and processing timelines of 4-8 weeks. Some banks require borrowers to open Bulgarian bank accounts and maintain minimum deposit balances throughout the loan term.
How stable is the Bulgarian property market, and what are the regional price risks?
Bulgaria's property market demonstrates moderate growth potential but significant regional volatility, particularly in resort and rural areas where price drops of 20-30% can occur during economic downturns.
We did some research and made this infographic to help you quickly compare rental yields of the major cities in Bulgaria versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.
Sofia's residential market shows the strongest stability with annual price appreciation of 3-8%, driven by economic growth and EU membership benefits. Coastal resort areas like Sunny Beach and Golden Sands experience higher volatility due to tourism dependency and seasonal demand fluctuations.
Rural properties and small mountain towns carry higher liquidity risks, with longer sale periods and limited buyer interest during market downturns. Currency fluctuation between the euro and Bulgarian lev can affect international investors, though Bulgaria's planned euro adoption may reduce this risk.
Oversupply concerns exist in certain resort developments built during the pre-2008 boom period, creating downward pressure on prices in saturated markets. Economic instability in neighboring countries and changes in EU policies could impact demand from foreign buyers who represent a significant portion of Bulgaria's property market.
What risks come with buying off-plan or newly built properties in Bulgaria?
Off-plan property purchases in Bulgaria carry substantial completion and legal compliance risks that can result in total investment loss if developers fail to obtain proper permits or complete construction.
Ensure developers possess all required building permits, including detailed architectural approvals and environmental clearances, before making any payments. Verify the developer's financial stability, track record, and previous project completions to assess their ability to finish your project.
Demand bank guarantees or escrow arrangements for staged payments rather than paying large sums upfront directly to developers. Many Bulgarian off-plan projects stall due to financing problems, permit issues, or developer bankruptcy, leaving buyers without recourse.
New construction must obtain Act 15 (building completion certificate) and Act 16 (occupation permit) before legal occupation. Projects without these permits cannot be inhabited, insured, or easily sold, making permit verification essential before final payment.
It's something we develop in our Bulgaria property pack.
What should I know about inheritance laws and property rights in Bulgaria?
Bulgaria follows forced heirship inheritance laws that may override wills and significantly impact foreign property owners' estate planning strategies.
Bulgarian inheritance law reserves portions of estates for lineal heirs, particularly children and spouses, regardless of the deceased's will preferences. This system can complicate inheritance planning for foreign property owners who expect full testamentary freedom.
Properties owned through Bulgarian companies offer more inheritance flexibility, as company shares can be transferred more easily than direct property ownership. Foreign ownership status doesn't prevent inheritance but adds administrative complexity and potential delays in property transfer processes.
Inheritance taxes in Bulgaria range from 0.4% to 6.6% depending on the relationship between deceased and beneficiary, with spouses and children receiving preferential rates. Non-resident beneficiaries may face additional tax obligations in their home countries, creating potential double taxation scenarios.
Proper legal structuring during the initial purchase can minimize inheritance complications and tax burdens for international families investing in Bulgarian real estate.
What taxes and challenges should I expect when renting out Bulgarian property?
Rental income from Bulgarian properties faces a flat 10% tax rate, plus potential social security contributions if you operate as a business rather than individual landlord.
Foreign landlords must register with local tax authorities and file annual tax returns declaring all rental income earned from Bulgarian properties. Municipal permits may be required for short-term rental operations, particularly in tourist areas like Sofia, Plovdiv, or coastal resorts.
Common practical challenges include finding reliable local property management agencies, dealing with tenant non-payment issues, and handling higher wear-and-tear in tourist-heavy regions. Bulgarian tenant protection laws can make evictions lengthy and expensive, particularly during winter months when evictions are restricted.
Property management costs typically range from 8-15% of rental income, while maintenance and repair expenses can be higher due to Bulgaria's climate extremes. Language barriers and distance management create additional complications for foreign landlords not based in Bulgaria.
VAT registration becomes mandatory if annual rental income exceeds €50,000, adding compliance complexity and quarterly reporting requirements for larger rental operations.
Conclusion
This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.
Buying property in Bulgaria involves navigating complex legal requirements, significant hidden costs, and various market risks that can substantially impact your investment returns.
Foreign buyers should budget 6-12% above purchase price for transaction costs, understand ownership restrictions for non-EU citizens, and conduct thorough due diligence to avoid common scams affecting international property investors in Bulgaria's evolving real estate market.
Sources
- OneWorld - Real Estate in Bulgaria Features
- Global Property Guide - Bulgaria Buying Guide
- Videliv - Buying Property in Bulgaria as a Foreigner
- Bulgarian Companies - Property Fees Calculator
- Bulgarian Companies - Conveyancing Fees
- InvestRopa - Buying Property Bulgaria Pitfalls
- Bulgarian Properties - Commission Structure
- Bulgarian Companies - How to Buy Property
- Mercury Estate - Taxes and Expenses FAQ
- Accountancy Bulgaria - Property Tax Guide