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How to Sell Property In Bulgaria For Sale By Owner

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Selling property in Bulgaria, particularly as a non-resident or foreigner, can be a nuanced process. While the “for sale by owner” (FSBO) approach might seem appealing for saving on agency fees, the complexities of Bulgarian property law, the necessity of specific documentation, and the intricacies of international transactions often make it advisable to seek professional assistance. However, if you are determined to navigate the process independently, a thorough understanding of the legal requirements, tax implications, and practical steps is paramount. This comprehensive guide will detail everything you need to know to sell your property in Bulgaria by owner, covering the legal framework, necessary documents, taxation, and financial considerations, including the role of a local bank account.

 

I. Understanding the Bulgarian Property Market and “For Sale By Owner”

 

The Bulgarian property market has seen significant fluctuations over the years, with periods of rapid growth, particularly in coastal and ski resorts, followed by stabilization. As of mid-2025, the market in popular areas like Sofia, Plovdiv, Varna, and Burgas generally remains stable with moderate price increases, driven by domestic demand and returning foreign interest. Rural and less developed areas might experience slower movement.

Selling “for sale by owner” in Bulgaria means you’ll be responsible for all aspects typically handled by a real estate agent. This includes:

While you save on agency commission (typically 2.5% to 3% for the seller in Bulgaria, sometimes up to 6% if acting for both buyer and seller), you assume the responsibility, time commitment, and potential risks associated with each of these steps.

 

II. Legal Framework and Key Roles in Bulgarian Property Sales

 

Bulgarian property law is based on a civil law system, which differs significantly from common law systems. All real estate transactions must be concluded before a Notary Public, who acts as an impartial public official ensuring the legality of the transaction and the proper transfer of title.

Key Players in a Bulgarian Property Sale:

  1. The Seller (You): The legal owner(s) of the property.
  2. The Buyer: The party acquiring the property.
  3. Notary Public: The crucial official who drafts and certifies the final Notary Deed (Title Deed), verifies all documents, ensures the legal compliance of the transaction, and registers the sale with the Registry Agency. Their role is mandatory and cannot be bypassed.
  4. Property Lawyer/Solicitor: Highly recommended, especially for foreign sellers. A Bulgarian lawyer will protect your interests, conduct legal due diligence, prepare necessary declarations, advise on tax implications, and crucially, can act on your behalf via a Power of Attorney if you cannot be physically present in Bulgaria for the signing of documents and the final deed.
  5. Valuer: While not always mandatory, a professional valuation can help you set a realistic sale price and is often required for financing by the buyer’s bank.
  6. Registry Agency (Property Register): This is where the new Title Deed is officially registered, marking the legal transfer of ownership.
  7. Local Tax Services Office / Municipality: Issues the tax evaluation certificate and handles local property taxes and waste management fees.
  8. Cadastre Agency: Issues the property sketch (cadastral plan).

 

III. Essential Documents Required for Selling Your Property (The Seller’s Checklist)

 

Collecting the complete and correct documentation is perhaps the most critical and time-consuming part of selling your property in Bulgaria. Any missing or incorrect document can significantly delay or even halt the sale. You will need to provide these to the Notary Public and your lawyer.

Here’s a comprehensive list of documents typically required from the seller:

  1. Document of Ownership (Notary Deed / Title Deed): This is the primary document proving your ownership of the property. You should have received this when you originally purchased the property. If lost, a notarized copy can usually be obtained from the Notary Public who certified the original transaction.
  2. Sketch of the Property (Skitsa / Кадастрална Скица):
    • Issued by the local Cadastre Agency (or Technical Department in the Municipality for older properties not yet in the Cadastre).
    • This document provides the cadastral number, boundaries, and precise dimensions of the property (especially crucial if there is land, or if it’s an apartment within a building).
    • Validity: Typically valid for 6 months from the date of issue. You may need to obtain a new one if it expires during the sales process.
    • Requires a copy of your Notary Deed to apply.
  3. Valid Tax Evaluation Document (Данъчна оценка):
    • Issued by the Local Tax Services Office in the Municipality where the property is located.
    • This document states the property’s tax-assessed value, which is used to calculate local transfer taxes and notary fees.
    • Crucial: All property taxes and waste management fees for the property must be fully paid up to date for this document to be issued. The tax evaluation document must also show the property address as absolutely identical to that in the Notary Deed.
    • Validity: Valid for the current calendar year.
    • Only the owner or a legal attorney can submit a request.
  4. Certificate of Marital Status (Удостоверение за семейно положение):
    • This document, obtained from your country of origin or an equivalent authority, declares your marital status as of the date of property acquisition and the current date.
    • If you purchased the property while married, your spouse may need to provide a Letter of Attorney (Power of Attorney) for the sale, even if they are not listed on the title deed, especially if the property is considered part of the matrimonial property community. This is a critical point to clarify with your lawyer based on Bulgarian family law.
    • If you are divorced, the court judgment for the dissolution of the marriage will be required.
    • Documents from abroad typically require translation into Bulgarian by a licensed translator and legalization with an Apostille (if your country is a signatory to the Hague Apostille Convention) or consular legalization.
  5. Certificate of Encumbrances (Удостоверение за тежести):
    • Issued by the Registry Agency, this document confirms that there are no registered encumbrances, mortgages, claims, or other third-party rights over the property.
    • This is essential to prove the property is free of legal burdens and can be freely transferred. Some notaries may check this electronically on the day of the deal.
  6. Declaration of Citizenship and Marital Status: As per Article 25, Paragraph 7 of the Law for the Notary Services. This is typically filled out in front of the Notary on the day of the deal or signed via Power of Attorney.
  7. Declaration of No Outstanding Taxes: A declaration stating that you do not owe any other taxes to the Republic of Bulgaria. Also typically filled out at the Notary on the day of the deal.
  8. Bulstat Registration Number: If you own the property as an individual, you must have a Bulstat number (a Bulgarian tax registration number). If you bought the property before it was mandatory to obtain one, you will need to register for it before the sale.
  9. Energy Performance Certificate (EPC): Required for all property sales, this certificate assesses the property’s energy efficiency.
  10. Proof of Identity: A valid passport or ID card.
  11. Bank Account Details: For receiving the sale proceeds (see section on local bank accounts below).
  12. Company Documents (if property owned by a company): If the property is owned by a Bulgarian company, you will need:
    • A written decision from the company’s shareholders authorizing the sale of the property.
    • Proof of the company’s re-registration (if applicable).
    • Current status certificate from the Commercial Register.

Important Note on Validity: Many documents have a limited validity period (e.g., sketch 6 months, tax evaluation for the current year). Ensure all documents are valid at the time of the final transaction.

 

IV. The Sales Process: Step-by-Step for FSBO

 

Even with an FSBO approach, certain stages are crucial and often involve a lawyer.

  1. Prepare Your Property: Ensure the property is clean, tidy, and presents well for viewings. Clear out unnecessary clutter. Consider minor repairs if needed.
  2. Gather Initial Documents: Start collecting your ownership deed, and apply for the tax evaluation and sketch. This can take several weeks.
  3. Set Your Price: Research local market conditions. Look at comparable properties recently sold in your area. Consider consulting a professional valuer. Be realistic to attract buyers.
  4. Market Your Property:
    • Take high-quality photos.
    • Write a compelling description (in Bulgarian and English, at least).
    • List your property on popular Bulgarian property portals (e.g., Imoti.net, Imot.bg, Property.bg) and potentially international ones that allow FSBO listings (e.g., A Place in the Sun, Rightmove Overseas).
    • Utilize social media, expat forums, and local community groups.
  5. Handle Enquiries and Showings: Respond promptly to interested parties and arrange viewings. Be prepared to answer questions about the property, local area, and the sales process.
  6. Negotiate an Offer: Once you receive an offer, negotiate the price and terms directly with the buyer.
  7. Preliminary Contract (Предварителен договор):
    • Once terms are agreed, a preliminary contract is drafted. This is a legally binding agreement outlining the sale price, payment schedule, timeline for the final deed, and any specific conditions (e.g., buyer securing financing).
    • Crucial: While you are selling FSBO, your lawyer must draft or at least review this contract to ensure your interests are protected and all necessary clauses are included. The buyer typically pays a deposit (usually 10%) upon signing this contract.
  8. Collect Remaining Documents: Your lawyer will advise on any outstanding documents required for the final Notary Deed. This is also when all outstanding property taxes and utility bills must be settled.
  9. Final Notary Deed (Нотариален акт):
    • This is the culmination of the sale process. All parties (or their legal representatives with Power of Attorney) must attend before a Notary Public.
    • The Notary verifies all documents, reads out the Notary Deed in Bulgarian (and often provides a translation or ensures one is present for foreign parties), confirms the buyer’s payment, and witnesses the signing of the deed.
    • The buyer typically transfers the balance of the purchase price to your designated bank account (or your lawyer’s escrow account) on this day.
  10. Registration: After signing, the Notary Public immediately registers the new Notary Deed with the Registry Agency (Property Register), officially transferring ownership. This usually takes 3-4 working days.

 

V. Taxes and Fees for the Seller

 

Selling property in Bulgaria incurs certain taxes and fees, which are typically shared between the buyer and seller, or are solely the seller’s responsibility.

  1. Capital Gains Tax (Income Tax on Sale of Real Estate):
    • Rate: 10% on the profit (the positive difference between the sales price and the acquisition price).
    • Calculation: The taxable base is the sale price minus the documented acquisition price, further reduced by a statutory 10% deduction for expenses.
    • Exemptions: This is a crucial point for sellers:
      • One residential property: Exempt if owned for more than 3 years (if acquired as a physical person).
      • Two properties: Exempt if owned for more than 5 years (if acquired as a physical person). This applies to any two properties (residential, agricultural, or forest).
      • Inherited Property: Profits from the sale of inherited property are generally exempt.
      • No Profit: If you sell the property for the same price or a loss, no capital gains tax is paid, regardless of ownership duration.
    • Declaration: If taxable, the income must be declared in your annual tax return (Form 50 for individuals) by April 30 of the year following the sale. Tax is paid at the location of the property.
    • Foreigners: The rules are generally the same for Bulgarian citizens and foreigners. However, double taxation treaties between Bulgaria and your country of residence may apply, potentially allowing you to claim tax paid in Bulgaria as a credit against tax owed in your home country, preventing double taxation. Consult a tax advisor in both countries.
  2. Local Municipal Tax (State Tax on Property Acquisition):
    • This is generally a buyer’s cost, but it’s part of the transaction so it’s good to be aware. It’s paid to the municipality and is typically between 0.1% and 3% of the sales price or tax evaluation (whichever is higher), varying by municipality.
  3. Notary Fees:
    • These are based on a government tariff, proportional to the property’s sales price or tax evaluation (whichever is higher), and vary depending on the value.
    • Typically shared between buyer and seller in practice, but this can be negotiated.
    • The Notary also charges 20% VAT on top of their fees.
  4. Registry Agency Fee: A state fee of 0.1% of the sales price for registering the new title deed. Typically paid by the buyer but can be negotiated.
  5. Legal Fees:
    • If you hire a lawyer (highly recommended), their fees will be your responsibility. These vary based on complexity and lawyer’s experience, typically a fixed fee or a percentage of the sale price. Expect to pay at least €500 – €1,500+ depending on complexity and location.
    • Additional fees may apply for Power of Attorney preparation, notarization, apostille, and translation if you are selling remotely.
  6. Real Estate Agency Commission:
    • 0% if selling “for sale by owner.” This is the main financial motivation for an FSBO sale.
    • If you decide to engage an agent later, commissions are usually 2.5%-3% for the seller.
  7. Translation and Legalization Fees: If you are a non-resident, documents from your home country (e.g., marital status certificate, Power of Attorney) will need to be translated into Bulgarian by a sworn translator and potentially legalized (Apostille or consular legalization). This cost is borne by the seller.
  8. Bank Fees: For transferring the proceeds out of Bulgaria.

 

VI. The Role of a Local Bank Account

 

Do you need a local Bulgarian bank account?

Yes, it is practically essential for selling property in Bulgaria, especially for non-residents. While technically a buyer might be able to transfer funds directly to an overseas account, this is highly uncommon in Bulgaria and generally discouraged by notaries and banks due to AML (Anti-Money Laundering) regulations and verification processes.

Reasons why a local Bulgarian bank account is crucial:

  1. Receiving Sale Proceeds: The Notary Public will almost certainly require the purchase price to be transferred to a bank account in the seller’s name within Bulgaria. This allows the Notary to verify the transfer of funds as part of the legal transaction process.
  2. Payment of Taxes and Fees: Any outstanding property taxes, municipal fees, or notary fees that are your responsibility can be easily settled from this account.
  3. AML/CFT Compliance: Bulgarian banks have strict Anti-Money Laundering and Counter-Financing of Terrorism regulations. Having an account opened in Bulgaria means your identity and source of funds have already been verified by a local institution, which simplifies the transaction process for the buyer and notary.
  4. Proof of Funds for Buyer: While primarily for the seller, having a local account can sometimes expedite the buyer’s side if their bank requires proof that funds are being transferred to a legitimate local account.

How to open a Bulgarian bank account as a non-resident:

Opening a bank account as a non-resident can be done, but it requires specific documentation and identity verification. You will typically need:

It is often easiest to open a bank account in person in Bulgaria. If you are selling via a Power of Attorney, your authorized representative (lawyer or agent) may be able to open an account on your behalf, but this must be explicitly stated in the Power of Attorney document. Many law firms that assist with property sales will facilitate this as part of their service.

 

VII. Repatriating Funds After the Sale

 

Once the sale proceeds are in your Bulgarian bank account, you will want to transfer them to your home country.

 

VIII. Potential Pitfalls and Why Professional Help is Key

 

While selling FSBO saves on commission, the complexities of Bulgarian law and the potential for errors can lead to significant delays, financial losses, or even legal disputes.

Common pitfalls for FSBO sellers:

Even if you sell FSBO, engaging a Bulgarian property lawyer is not optional; it is a critical investment. They will ensure legal compliance, protect your rights, and often handle the most complex administrative tasks on your behalf, especially if you are not present in Bulgaria. Their fee is a small price to pay for security and peace of mind in a foreign legal system.

 

 

Selling property in Bulgaria as a foreigner without a real estate agent is technically possible but demands a high level of dedication, meticulous attention to detail, and a thorough understanding of the local legal and tax landscape. The process is heavily regulated, with the Notary Public playing a central role in validating all transactions. Crucial steps include gathering extensive documentation (Title Deed, Tax Evaluation, Sketch, Marital Status certificates), navigating potential capital gains tax liabilities (with important exemptions for long-term ownership), and understanding the necessity of a local Bulgarian bank account for receiving sale proceeds. While the allure of saving agency fees is strong, the inherent complexities of a foreign legal system, the need for precise documentation, and the intricacies of international fund transfers make professional legal assistance not just advisable, but practically indispensable for a smooth, secure, and successful transaction. Your Bulgarian lawyer will act as your guide and representative, ensuring that your interests are protected every step of the way, even if you manage the marketing and negotiation aspects independently.

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