Bulgaria remains one of the most attractive countries for foreign investors due to its mild climate, picturesque landscapes, affordable real estate prices, and high investment potential. For foreigners, buying property in Bulgaria has become a popular way to improve their quality of life, obtain a residence permit, or create a source of passive income. However, the purchasing process has its own peculiarities, and current market trends require careful analysis. In this article, we will explore the key aspects of real estate purchases for foreigners and examine the dynamics of housing prices in Bulgaria and the EU.
Why Do Foreigners Choose Bulgaria?
Bulgaria offers numerous advantages for property buyers:
- Affordable prices. Compared to other European countries, real estate prices in Bulgaria remain competitive. For example, in the fall of 2022, studios on Bulgaria’s coast could be purchased on an installment plan for up to 10 years for €30,000. By the fall of 2023, such studios cost from €40,000 (with installments), and by the fall of 2024, their price had risen to €50,000–€60,000. On the secondary market or with full payment, a studio can be found for €40,000, but prices from construction companies, especially those offering installments to Ukrainians, show significant growth.
- Resort potential. The Black Sea coast (e.g., Burgas, Varna, Sunny Beach, Golden Sands, Nessebar) and ski resorts (Borovets, Bansko, Pamporovo) attract tourists year-round, making property purchases profitable for rental income.
- Quality of life. Low taxes, developed infrastructure, accessible healthcare and education, and beautiful nature make Bulgaria attractive for living.
- Residence permit. Purchasing property worth at least 600,000 BGN (approximately €307,000) can serve as a basis for obtaining a long-term residence permit, which is particularly valuable for citizens of non-EU countries.
Current Trends in the Real Estate Market in Bulgaria and the EU
The real estate market in Bulgaria demonstrates significant growth, as confirmed by Eurostat data for the first quarter of 2024. Over the year (from the first quarter of 2023 to the first quarter of 2024), housing prices in Bulgaria rose by 16.0%, and by 7.1% in the quarter. This is one of the highest rates in the EU, indicating high demand and economic growth.
At the same time, diverse trends are observed across the EU:
- In seven countries (e.g., Luxembourg with a decline of 10.9%, Germany at 5.7%, and Finland at 4.8%), housing prices decreased.
- In 19 countries, including Poland (+18.0%), Lithuania (+9.9%), and Croatia (+9.1%), prices increased.
- In popular investment destinations such as Spain (+6.4%) and Portugal (+7.0%), moderate growth is observed, while in Germany and France, prices fell (by 5.7% and 4.8%, respectively).
This growth in Bulgaria underscores that those who invested in real estate at early stages (e.g., at the beginning of the full-scale war in 2022) made a strategically sound choice. However, the value of properties on Bulgaria’s coast is still far from its peak. The upcoming transition to the euro will likely lead to a gradual but noticeable price increase. In our next analytical article, we will explore in detail the experience of EU countries that adopted the euro and its impact on the real estate market.
Rules and Features of Purchasing Real Estate for Foreigners
Although Bulgaria is open to foreign investors, there are nuances to consider:
- Legal Rights of Foreigners
Foreign citizens have the right to purchase real estate in Bulgaria under the same conditions as local residents, with the exception of agricultural land. Land purchases are possible only through the creation of a legal entity (e.g., a Bulgarian company) or joint ownership with a Bulgarian citizen, as per the Bulgarian Constitution. - Required Documents
For a foreigner to purchase property, the following are needed:- Passport or other identity document.
- Documents confirming the source of income (if required for bank transactions).
- A notarized purchase agreement, registered with the Property Registry (Cadastre).
- In some cases, a permit from the Bulgarian Ministry of Justice if the purchase involves land.
- Taxes and Fees
The property transfer tax ranges from 0.1% to 3% of the property’s value, depending on the region and property type.
The annual property tax in Bulgaria is very low—between 0.01% and 0.45% of the assessed value of the property.
Foreigners pay a 10% income tax on rental income if they lease the property. - Purchasing Process
A foreigner must open a bank account with a Bulgarian bank to conduct financial transactions.
The transaction is formalized through a notary, who verifies the transaction’s legitimacy, absence of encumbrances, and registers the ownership in the Cadastre.
After the purchase, a property ownership certificate is issued, serving as the primary document for property ownership. - Restrictions and Risks
Some areas, particularly near borders or strategically important sites, may have restrictions on purchases by foreigners. This requires consultation with a lawyer.
It is important to avoid fraud: always work with reputable agencies or attorneys familiar with local legislation.
Advantages and Challenges for Foreigners
Purchasing real estate in Bulgaria provides access to resorts, high rental income, and a relatively straightforward naturalization process. However, language barriers, the complexity of understanding local laws, and bureaucracy can pose challenges. This is why many foreigners turn to professional agencies that know the market and help avoid mistakes.
How to Minimize Risks?
- Work with a licensed real estate agent or law firm specializing in property for foreigners.
- Check the property’s history through the Cadastre to rule out risks of encumbrances or disputes.
- Ensure all documents are translated and certified, especially if you do not speak Bulgarian.
Pallant Real Estate — Your Partner in Bulgaria
Pallant Invest Ltd. (EIK 207076312) is your reliable partner in selecting new real estate in Bulgaria. We provide a full range of services for foreigners, including assistance with purchases and property selection at various stages of readiness (project, Act 14, Act 15, Act 16). Our portfolio includes over 186 projects located in key regions:
- Sofia and Plovdiv — 123 residential complexes;
- Black Sea coast (from Burgas to Varna) — 62 complexes;
- Ski regions — 4 complexes.
Our team, with deep market knowledge and years of experience, will help you find the perfect property, minimize risks, and realize your investment or housing plans. Contact us via our website or by phone to start your journey toward your dream property in Bulgaria!
