Ten Top Tips For Buying Property In Bulgaria
Bulgaria has matured to become an attractive nation in which to buy a long term property investment asset, a holiday home or a second home. Furthermore, certain parts of the nation are now attracting Britons and Europeans seeking a better quality of life which has significantly increased interest in the Bulgarian property market.
This increase in sustained interest has had a number of interesting effects on the overall situation of the market including a firming up of prices and an active resale element emerging, and so if you’ve been thinking about moving abroad or buying real estate overseas, here are our ten top tips for buying property in Bulgaria.
1)Think about why you want to buy a property...this will have a profound effect on where exactly you buy as well as what you buy. For example, if you’re looking for an investment asset, you might like to look at Sofia and buy an apartment as a business let to get the best yields, the best chance of capital appreciation and to be in one of the best locations in the nation when it comes to a resale market. If on the other hand you want a summer holiday home, you will probably be drawn to the coastline. Have a think about why you want to own a home in Bulgaria and let this choice guide you.
2)Consider the financial aspects of the purchase beginning with your mortgage requirements. If you need a hand financing the property you can apply for a mortgage in Bulgaria and usually the maximum you can borrow is 70% of a property’s value...however, the banks invariably value a property at a lower value than the asking price! So, consider speaking to a lender about the way they value a property and the likely amount you can borrow based on your personal circumstances. Never take yourself to your financial limit when making an offer on a property, leave room for the mortgage offer you want to come in a little lower than you expect and then you should be okay!
3)If you’re buying a property prior to its completion it is almost impossible to raise a mortgage in Bulgaria to help you afford the stage payments. See whether there are any developers offering financing deals on their properties as an alternative.
4)Or, consider re-mortgaging your current primary residence to afford to buy a property in Bulgaria. But bear in mind that you will then effectively be securing your Bulgarian property on your UK property and that should you struggle to keep up repayments, your UK home could be repossessed. Never over extend yourself financially speaking...be modest.
5)If you’re buying a property prior to its completion, insist that the developer you’re buying from shows you completed examples of properties he has built. You need to ensure he is competent, can complete a project and that his building standards meet your standards. If you cannot see satisfactorily completed examples of his work – do not buy from him.
6)Take your time when making any purchase decision. Buying a property is a massive financial undertaking and a long term commitment for most of us. What’s more, buying a home abroad brings with it even more considerations and concerns too – so do not be rushed into making a decision and do not rush yourself into making a decision. Take time, review facts, revisit properties, check details with lawyers and surveyors and only when you are entirely comfortable that you want to proceed should you consider signing a contract.
7)When it comes to the contract you need to read it! You need to understand everything about it, you need to have a lawyer check it and it needs to contain any ‘subject to’ clauses relating to the contract being voided if you cannot get finance, if there are issues found with the title deeds etc.
8)Ask for detailed proof of clear ownership of the property by the vendor before you sign. You need to see for yourself, with your own eyes that the person selling you the property in Bulgaria has the legal right to do so. If they have the legal right to do so, it will not be difficult for them to prove this to you.
9)Remember that things can take time in Bulgaria – that the pace of life is slower than in the UK, the red tape takes longer to unravel and that the purchase process can seem so long winded and long drawn out that you will at times wonder whether it will ever reach a conclusion! Take heart – this is normal! Keep in touch with your agent and your lawyer to see whether the process is proceeding smoothly, and try and relax...it will get done in the end.
10)And finally, ensure that you’re aware of all additional costs, fees and taxes up front before you agree to buy any home in Bulgaria for any price. All of these add ons can stick about 10% of the purchase price on top sometimes, so be informed by your agent and solicitor and factor this in to your budget.