It seems hard to believe that it is only four years since Bulgaria first came onto the radar as a location in which British people might want to buy property. At the time it seemed a rather extraordinary idea - who would want to buy a house in a poor and depressing (that was the perception) country scarred by years of communist rule?
Fast-forward to 2007, and the question many people are asking is: can I afford not to buy something in Bulgaria? Is this the opportunity of a lifetime, or have I missed the boat already? Even the sceptics, including some of our most upmarket estate agents, have conceded that there is more to this country than first met the eye, and have dipped their toes in the water.
At first, Bulgaria was purely about cheap. The joke was, you could hop out there and buy an old house, in the countryside at least, on your credit card. Install a pool? £2,000. A Black Sea villa? £15,000. Things have moved on since then, of course. Now the Bulgarian market is as much about high-quality apartments in the ski resorts of Bansko, Pamporovo and Borovets as it is about run-down rural cottages.
The first wave of super-cheap coastal apartments is being succeeded by upmarket developments that feature spas, marinas and golf courses. And there's an established community of expats who aren't just looking to make a quick speculative buck, but have moved lock, stock and barrel to a country where the slow pace of life, good food, friendly people and excellent value for money suddenly look rather favourable compared to rat-race Britain.
Travel
Air
It takes three and a half hours to fly from London to Sofia, and a little longer to the Black Sea coast or from points north in the UK. Bulgaria currently has four international airports: Sofia, the capital; Varna and Bourgas, both on the Black Sea coast; and Plovdiv, in the middle of the country. The picture, both in terms of the numbers of flights and the airport infrastructure, is changing quickly. Sofia, for example, which is the main hub for the ski areas, benefited last year from the addition of a second runway and a second terminal. It now has the capacity to handle up to 2.6m passengers a year. Plovdiv also had a new passenger terminal in 2005, though the number of passengers it handles is still quite low. Bourgas and Varna are also undergoing modernisation.
Until recently, the majority of flights to Bulgaria were summer charters, but that is also changing, especially with the rapid development that is taking place in the ski centres. British Airways flies daily from Heathrow to Sofia, and twice a week from Gatwick to Varna throughout the year. BulgariaAir flies daily from Gatwick to Sofia, and twice a week from Manchester to Sofia. Budget airline Wizz already flies three times a week from Luton to Sofia and will be flying from Luton to Bourgas from June. Other airlines are expected to announce new flights this year (2007).
Sea
Bulgaria does have some passenger ferry services - principally to the Ukraine and Georgia - of limited interest to British property owners. Navigation Maritime Bulgare is the main ferry company. Possibly of more interest is the need to get a car shipped out, in which case a company called Autoshippers can help.
Train
Bulgaria's first railway line opened in 1866, and the network is still in good health with more than 700 stations nationwide. Bulgaria's state railway company has also undergone transformation in the run-up to EU accession. In 2002, it was split into two companies, railway operator BDZ and an infrastructure company. Trains aren't fast - the fastest from Sofia to Varna, around 236 miles, takes seven hours - but they are cheap. The same journey would cost 20 Bulgarian Lev, or around £6.40.
Roads
Roads in Bulgaria are not brilliant. A joke on the internet goes as follows: during the war in former Yugoslavia, two pilots flying over a region and look down at the twisted, potholed road below. Have we already bombed here, asks one? No, it's Bulgaria and it's always like that, is the reply.
Bulgaria has 37,000km of roads and most are in a pretty shocking state, so much so that the World Bank said serious upgrading was needed to meet EU safety standards. EU money will make a difference, but it will take time. Driving in Bulgaria can also be pretty hair-raising, as many drivers routinely overtake at every opportunity on two-lane highways. So for getting around the country, train or plane are definitely worth considering over any distance. Also, look out for slow-moving donkeys and horse-carts.
Buses
There is a good network of bus services throughout the country, more popular than the trains according to one source. Three companies offering services with modern vehicles are Biomet, Etap and Group.
climate
Bulgaria's landscape ranges from mountains to 350km of coastline; it is situated at roughly the same latitude as northern Spain or central Italy. It acts as a buffer between the Mediterranean and continental climate zones. All this makes for a climate that is generally temperate, with warm, but not scorching hot, summers and fairly cold winters.
The country has half a dozen mountain ranges, of which the Rhodope, Pirin and Rila are the best known; the highest point is Mount Musala at 2,925 metres. Bulgaria gets a lot of snow in winter, which explains why it is rapidly becoming such a popular ski alternative to the Alps. Average temperatures in Sofia range from -1°C in January to 25°C in August; on the Black Sea coast it seldom reaches freezing point and temperatures range from around 5°C in January to 25°C to 30°C in summer, though it can sometimes hit 35°C. There can be a persistent wind coming off the sea in late summer.
Wine is one of the country's main products and there are vineyards all over the country. There's also an area called the Valley of the Roses between two mountain ranges - the Balkans and the Sredna Gora. In May and early June it blooms with colour as millions of roses are cultivated for the perfume trade.
Language
The prospect of learning another language can be intimidating to some; when you have to take in another alphabet it becomes even more so. Bulgarian is one of the Slavonic family of languages, closely related to Serbo-Croat, and it is written in Cyrillic script. Fortunately, street signs, menus and most documentation are also written in the Latin equivalent, which makes it slightly less scary. Written Bulgarian is not an easy language for native English speakers to learn - apart from the new alphabet, it has quite a few oddities: there are three genders, for example, masculine, feminine and neutral; and there are no infinitives.
A strange side-effect of interest in Bulgaria's property market has been the proliferation of courses teaching the language at various places around the UK, as well as self-help language courses in book or CD form. Knowing Russian certainly helps, but the consensus among Brits living in Bulgaria is that learning the language is not easy.
Whether you can get away without learning Bulgarian is less clear. If your property is in one of the main resorts on the Black Sea, then the answer is quite probably yes, as English is already widely spoken and destined to become even more so. In a village, though, it's hit and miss whether there are any English speakers locally. And don't forget that when a Bulgarian nods it means 'no' and when he shakes his head it means 'yes'.
Key Bulgarian phrases include:
- Property - 'sobstve'nost
- The Notary - 'no'tarius
- Solicitor - 'advo'kat
- Sales contract - 'dogo'vor za pro'dazhba
- Planning permission - 'razre'shenie za stro'itelstvo
- Title deeds - 'notari'alen akt
- Deposit - 'vlog; or de'pozit
- Loan - 'zaem
- The buyer - 'kupu'vach ('the' buyer literally is kupuvachat; "at" is the article)
- The seller - 'proda'vach (prodavachat)
- An estate agent - a'gent po ned'vizimi i'moti
- An apartment - 'aparta'ment
- A block of flats - 'blok
- A traditional stone house - 'traditsi'onna 'kamennna 'kashta
- A farmhouse - 'selska 'kashta (a rural house to be more exact)
- A large house - go'lyama 'kashta,
- Castle - 'zamak
- A family house - se'meyna 'kashta
- To be restored - za 'vazstano'vyavane
- Can be converted - 'mozhe da se 'preobra'zuva
The apostrophe in each word's transcription designates accent on the syllable after it.
Legal
Visas
Since Bulgaria joined the EU at the beginning of January 2007, there is no need for holders of British passports to apply for a visa when visiting for up to 90 days within a six month period. If you are going to stay for longer, then according to the Bulgarian Embassy's website, you need to apply for a long-term visa which is available from the Bulgarian Embassy.
However, reports from expat forums suggest that since the beginning of 2007, immigration authorities have been granting long-term residency certificates - up to five years or until your passport expires - without a visa being required. You apply at the immigration section of your regional police station in Bulgaria, and the documentation you are likely to be asked for includes your passport, birth and marriage certificates, evidence that you can support yourself in Bulgaria, and documentation to prove your address. After five years, you can apply for a Permanent Residency Certificate.
Property ownership and the buying process
The process of finding property to buy depends very much on what you are looking for. In Bulgaria, the vast majority of sales to British buyers are off-plan sales of apartments, townhouses and villas in new developments, in which case the likelihood is that you'll find what you're looking for through UK agents or the developers themselves.
There is no shortage of Bulgarian estate agents on the ground in the main areas, who will take you round to see properties old and new, but they will often charge for accompanied visits, refunding your money if you buy. The other approach, if you've fallen in love with a particular village, is to ask the locals if there's anything for sale as many properties are transacted without the help of agents. Of course, you also have to decide what type of location you're looking for; the main alternatives are Black Sea, ski resort, rural village or in one of the larger towns and cities such as Sofia.
It's really not a good idea to buy a property off-plan in Bulgaria without having at least visited the site. Such is the pace of development in the key areas that you really need to look at exactly where your property will be, how close it will be to facilities, what the surrounding developments are and so on. "Overlooking the golf course" may turn out to be no more than a glimpse, and you have no rights of access. Lots of companies offer fairly cheap inspection trips. Typically, you will be asked to put down a reservation deposit when buying off-plan; this is often around €1,000 and is non-refundable. The developer will usually prepare the contracts, though that doesn't mean you shouldn't get your own lawyer to scrutinise before signing anything.
If you're buying an older property the purchase process will involve a notary (notarius). The one crucial point to understand is that, for now at least, you cannot own land as an individual if you are not a Bulgarian citizen. You can buy the building that stands on the plot, but not the land itself. This restriction is due to change - the Bulgarian Government has already voted on it - but the change will not come into force until 2014.
In the meantime, you have to set up a Bulgarian limited company to buy the land and the property on your behalf. Registering a company takes between two and four weeks and you will need a lawyer to do it for you. Charges for registering companies vary wildly, according to how gullible the buyer is, but you shouldn't pay more than £400. In addition, you will be required to deposit 5,000 Lev as the company's capital.
Once you've made an offer to buy a property - usually a letter written by your lawyer that is legally binding - you will sign a Preliminary Contract (Predvaritelen Dogovor) and pay a 10% deposit if you haven't already done so. You should always make sure that your lawyer has included sensible get out clauses. A common area for problems to emerge is where proper title cannot be established, as the Land Registry is a relatively recent invention in Bulgaria.
Fees and taxes
The Contract of Sale (Notarialen Act) is usually signed by a Bulgarian lawyer on your behalf, and at this point the balance of the purchase price must be paid. It is quite common for Bulgarian lawyers to suggest that a price much lower than the true price is declared for tax purposes. This is a controversial subject, but the majority view seems to be that it is safer to declare the true price - not least since when you come to sell you could otherwise be liable for a much higher capital gains tax.
New properties are subject to VAT at 20% (2007) - you should always check whether this is included in the purchase price. In addition, all property purchases are subject to transfer and local taxes. You should allow at least £500 for legal costs - in addition to company registration - and the agent may charge you another 3%, depending on whether they are receiving commission from a developer. Overall, expect to pay at least 7% of the purchase price in taxes and other costs.
Communications
Telephone
The national phone operator is BTC, the Bulgarian Telecommunications Company, whose website has an English language version. Large parts of the network are still analogue, so in many cases, phones taken from the UK will not work in Bulgaria. However, it is modernising and has a set of calling plans similar to those from BT, bundling free calls and line rental. Getting a line installed takes about one month and costs approximately £25. And in a throwback to how it used to be in the UK, you're expected to pay your bill at the post office.
Mobiles
As regards mobiles, many people moving to Bulgaria from the UK simply buy a SIM card when there and pop it into their existing phone - though some phones need to be 'unlocked' first. This is much cheaper than using the roaming tariffs of UK networks. There are three mobile networks in Bulgaria: GloBul, Mobiltel and Vivatel which all have websites with English pages. Sim packs can be bought at retail outlets in the main towns.
Broadband
A map on the BTC website shows the number of towns where broadband ADSL internet service is now available. It is spreading, but if you are in a village you are unlikely to get a service. However there are cable services in quite a few villages that offer an alternative high-speed internet service. There are plenty of internet cafés popping up in the bigger towns, and in the most rural areas, a dial-up service may still be available.
Television
The good news for avid TV viewers is that you can pick up Sky, Channel 4 and Channel 5 with a decent satellite dish. The bad news is that you won't be able to get BBC channels or ITV unless you've a dish that would put GCHQ to shame. Even to pick up Sky, you need a large dish, since Bulgaria is at the outer extreme of the footprint served by the Astra satellite. You'll also need to buy a Sky digibox and whatever subscription package you have in the UK. Bulgaria has three free to air terrestrial channels, which can be useful for non-Bulgarian speakers to watch European football, if nothing else.
financial
Banking
At the time of writing in 2007, Bulgaria doesn't have any familiar banking names from the UK, so it is a question of taking the plunge with one of the local banks. Most British people with homes there clearly find it easiest to open an online account, not least as a number of banks allow you to conduct your banking in English - though you may need to go into a branch initially to set up the account, or to set up direct debits.
Whether you'll find someone who speaks English in the branch is a hit and miss affair. Banks that have English translation on their websites and offer online banking with the option to pay your bills online include Postbank, United Bulgarian Bank, First Investment Bank and Bulbank. Another option is the German bank Allianz which doesn't have English on its website.
Finding a bank with branches in both Bulgaria and the UK is a challenge; the Greek bank, Piraeus is one of the few that does. Credit cards are not widely accepted in Bulgaria, and there are many credit card scams, so you should be very careful who you give your card to.
Mortgages
You can obtain a euro mortgage in Bulgaria in spite of the fact that the country has not adopted the currency as yet. However, loans tend to be considerably more expensive than in Euro-zone countries; at the time of writing, most interest rates quoted were in the range 6.95% to 7.9%. One UK broker who specialises in mortgages in Bulgaria is BulgarianHomeLoans.com, which offers mortgages from a range of lenders including DSK Bank, Piraeus Bank, Bulbank and UBB.
Maximum loan to value is 75% or less, and there is usually a minimum loan of €40,000. You will be expected to provide the usual evidence of employment, earnings, etc. You shouldn't agree to purchase a property until your mortgage has been agreed in principle, and you should also be aware that arranging a mortgage in Bulgaria can be a longer process than in the UK, taking up to three months. The cheaper option is to raise the money to buy a Bulgarian property by borrowing against your UK home, since interest rates are lower in the UK.
Taxation
Bulgaria is generally viewed as a low tax economy. Its top rate of income tax is just 24%; and corporate tax was cut from 15% to 10% at the beginning of 2007 in a bid to make the country more competitive for business.
There are a number of property taxes you have to pay. On property purchases you pay Vat at 20% as well as a municipal transfer tax of 2%. There's also an annual property tax of 0.15% of the book value of the property. And on rental income, you pay 10% municipal tax on the profit after deductions, followed by 10% corporate tax on the residual profit. Capital gains when you sell are treated simply as income, and are also subject to corporate tax.
Calendar
The following days are bank holidays in Bulgaria. Businesses and government offices are closed, with the exception of cafes and restaurants.
- 1-2 January - New Year
- 3 March - National Holiday (liberation from the Ottoman Turks)
- 1 May - Labour Day
- April - Easter
- 6 May - Gergyovden (St. George's Day) and Bulgarian Army Day
- 24 May - Bulgarian Education and Culture Holiday / Slavonic Literature Day
- 6 September - Unification Day
- 22 September - Independence Day
- 24, 25, 26 December - Christmas
Christmas is celebrated mainly on 24 December, with a huge meal that involves one dish for every month of the year. Easter is a time for fasting, while St George's Day (May 6) is the main Spring festival.
A major event for tourists each year is the Festival of the Roses, which takes place in the first week of June. People come to Kazanlak, the rose-growing region, to see street processions, dancing and the coronation of the Rose Queen.
April 2007.
Alexander Garrett is a freelance property writer who contributes regularly to The Observer and British Airways' Business Life.
The content provided in the Primelocation.com guides is for information only. In all cases, independent and professional advice should be sought before buying, selling, letting or renting property, or buying financial services products.