Part of the Balkan Peninsular, Bulgaria lies at the crossroads of Europe and Asia. A small country, it has a varied and picturesque landscape that embraces ski resorts and a Black sea coastline stretching approximately 200 miles between Romania and Turkey.
Bulgaria has land borders with Greece, the former Yugoslav Republic of Macedonia, Romania, Serbia and Montenegro, and Turkey. The climate is temperate with cold, damp winters and hot, dry summers. Natural hazards include the possibility of earthquakes and landslides.
The largest and most developed of the Bulgarian ski resorts is Bansko. It has recently held legs of the European Ski Championships, and the ski facilities are both state of the art and much more expansive than in the smaller resorts of Borovetz and Pamporovo.
Bulgaria now has a free market economy. Largely agricultural, the country is an exporter of wine, vegetables, fruits, and tobacco. It is also known for its yogurt.
After a setback in 1996, the economy has been growing in recent years. A 2002 EU report said this was likely to continue, but at a slower rate the an the near 6 per cent achieved in 2000.
It identified the main problems for the Bulgarian economy as high unemployment, low domestic investment and high public debt. Nevertheless, the commitment by the Bulgarian government to tight fiscal control and to structural reforms would open up opportunities for a strong growth in future years, it concluded.
In early 2007 Bulgaria was granted membership into the EU, since when the economy received a significant boost.
Property prices are still relatively low but have been rising fast. The International Real Estate Federation put the December 2004 average price of residential property at 6,650 pounds per square metre in London but only 280 pounds in Bulgaria's capital city Sophia. Black Sea resort properties came in at between 105 pounds and 350 pounds per square metre while the average annual price rise was put at 23 per cent.
More recently it has forecast 'double digit' the price increases this year with a slow down in 2007, followed by one year of 'wait and see'.
In order to own the land as well as the apartment that sits upon it, a foreigner can buy the property through a non-trading shell company. The cost for setting up a shell company is approximately 500 Euros.
The property purchase taxes are much more attractive to an investor than in most other countries. The total property purchase costs are 2.34 per cent of the property (compared to much higher percentages in France, Italy, Spain etc.) This 2.34 per cent includes land tax, notary fees and local tax (stamp duty). Lawyers fees cost in the region of 1300 euros.
The purchase process usually involves an initial deposit followed by exchange of contract and payment of a further deposit of between 10 per cent and 30 per cent. Transfer documents are then signed in front of a Bulgarian Notary (this can be done overseas in a Bulgarian Embassy).
Notary fees are paid on a scale based on the higher of the market price or the book value of the property at varying rates. The maximum is 1,225 pounds. In addition, 2 per cent of the market value of the property must be paid to the local municipality.
Net rental income, after expenses and municipal taxes, is subject to a 10 per cent deduction. The net amount may be repatriated by overseas property owners, subject to presentation of a certificate confirming taxes have been paid. Realised capital gains are treated as income.
Local annual property taxes 0.15 of the declared value of the property - the tax estimation price is that written into the transfer deed but is often lower than the actual purchase price.