Buying Property in Bulgaria: Taxes, Costs, ROI, Property Maintenance, Residence Permit and Citizenship

Bulgaria remains an attractive destination for buying property due to its low prices, mild climate and the possibility of obtaining a residence permit.

However, buying property abroad requires careful consideration of taxes, costs and return on investment prospects. We have compiled for you the key aspects of buying and maintaining property in Bulgaria.

Real estate transactions in Bulgaria are considered to be among the simplest and most transparent in Europe. The entire process usually takes about a week, and with the necessary documents (tax assessment and Cadastre extract) it can be completed in 2-3 days.

The purchase procedure is carried out through a notary, who:

• Checks the legal purity of the property;
• Certifies the purchase and sale agreement;
• Draws up a notarial deed - the main document confirming the right of ownership.

Thus, the transaction is under state control and reliably protected.

Mandatory expenses when purchasing:

• Notary - up to 1% of the price of the property indicated in the notarial deed;
• Translator - 30-50 euros;
• Municipal tax on the transfer of ownership - 2.9% of the price of the property;
• State fee for registration - 0.1%;
• Services for submitting documents to the registry (if you do not know Bulgarian) - 150-200 euros through an agency; Bank commission for international transfer - about 50 euros.

After purchase

The owner is required to register with the tax authorities within two months and pay annually:

• Property tax — 0.15% of the cadastral value (which can be 40–100% of the market price);
• Communal tax (for garbage removal, etc.) — 0.17%–0.245%, set by local authorities depending on the region and characteristics of the property.

A 5% discount is provided for a one-time payment of taxes for the year. In case of non-payment, fines, problems with obtaining a residence permit, and seizure of property are possible.

The yield from renting out real estate depends on its location:

• Seaside resorts (Sunny Beach, Golden Sands) – 5%–7% per annum.
• Mountain resorts (Bansko, Pamporovo) – 4%–6% per annum.
• Sofia and other large cities – 5%–8% per annum.

Real estate prices in Bulgaria grow by an average of 3%–6% per annum, making investments profitable in the long term.

Profit tax on the sale of real estate

• When selling real estate in Bulgaria, owners are required to pay profit tax. The tax is 10% of the difference between the sale price and the purchase price of the property.
• This tax is levied only if the property is sold within 3 years of purchase. If the property has been owned for more than 3 years, the tax is not levied.

Annual property maintenance costs

On average, property maintenance in Bulgaria costs 500 euros per year. Maintenance fees depend on the type and location of the property:

• Standard houses: 5-10 euros/m² per month;
• Serviced apartment complexes: 3-15 euros/m² per month or a fixed amount.

Paying 2-3 years in advance can provide a significant discount.

Utilities (approximate rates)

• Electricity:– standard rate — 0.10 euro/kWh

– daytime — 0.23 euro/kWh
– nighttime — 0.13 euro/kWh

• Gas heating — 0.12 euro/kW
• Water supply and sewerage — 1.50 euro/m³
• Internet and telephone — about 5 euro/month
• Payment of utilities

You can pay:

• At a bank, post office or stores;
• Online — on suppliers’ websites or through payment systems.

In many residential complexes, management companies help with utility payments: they take meter readings, issue invoices, and after receiving payment, make settlements with suppliers.

Rental Tax

In Bulgaria, the rental income tax rate is 10%.

• The property owner is required to file an income tax return and pay the tax within the established deadlines.

Buying real estate does not guarantee automatic receipt of a residence permit, but is the basis for its registration. Basic conditions:

• Owning real estate of any value.
• Availability of financial means for living.
• Registration of health insurance.
• No criminal record.
• A residence permit is issued for a year and can be extended.

Citizenship of Bulgaria

Purchasing real estate in itself does not give the right to citizenship. However, it is possible to obtain permanent residence through investment (from 512,000 euros), and after 5 years - citizenship.

Buying real estate in Bulgaria is a profitable investment, especially for those who consider the country as a place for recreation, business or permanent residence. It is important to consider all taxes, expenses and legislative features before buying. A competent approach will allow you not only to avoid unexpected costs, but also to receive a stable income from investments.

Mercury Group specialists take on the entire process of purchasing real estate in Bulgaria, starting with the selection of the property and ending with the preparation of a package of necessary documents "turnkey", and also assist our investors by providing a full range of concierge services.

Buying real estate in Bulgaria is a profitable investment, especially for those who consider the country as a place for recreation, business or permanent residence. It is important to consider all taxes, expenses and legislative features before buying. A competent approach will allow you not only to avoid unexpected costs, but also to receive a stable income from investments.

Mercury Group specialists take on the entire process of purchasing real estate in Bulgaria, starting with the selection of the property and ending with the preparation of a package of necessary documents "turnkey", and also assist our investors by providing a full range of concierge services.