Bulgaria

daveball

I am just back from Bulgaria , where I bought a 2 bed apartment for 40 k in Sunny beach.
I know you are saying that you would like a ski resort but it might be worth looking into buying in 1 of resorts like sunny beach or golden sands.
Lets say you bought a 2 bed in sunny beach, you can fly from Dublin direct to Burgas airport and have a 20 min journey to the resort.
Then if you wanted to go sking organize your journry from there as I see in an earlier post there are no direct airports in the ski resorts so you are going to have the make the journey anyway.
I have been to Bulgaria many times and finally decided to buy there this year, I would stronly reccomend for anyone interested in investing to look here.
The rental income in any country like spain, portugal etc is always advertised as a selling point.
I have had properties in Spain an know from the past that you cannot rely on the rental to pay for any morgage, so if you can afford to pay for the loan without the rental income you will be safe enough.
I dont want to post the link for the property website where I bought mine from but if anyone would like to know more about it drop me a mail its daveaball@gmail.com

mukki

"you will love bratslavia" :eek:

chump

A few questions for you - thanks for your help?

What are the tax rules regarding rental income from destinations like these?
What is the gross yield on the place you bought?
What are the figures and information you have that have substantiated these figures?
What interest rate mortgage and LTV did you take out?
What is the market for selling 2nd hand properties there?
Is there stamp duty?
Is there capital gains tax?
Does Ireland have a double taxation agreement with them?
What is the yearly climate like there?
What is the supply of new apartments like there?


Cheers, very interested in this.

patrickolee

sounds like an ad

Pa ElGrande

For those of you with money burning a hole in your pockets take time to read Barryo's and Auto320's posts on AAM before venturing into Bulgaria.

http://www.askaboutmoney.com/showthread.php?p=387503#post387503

You don't even need to fly there to see what its like.

http://wikimapia.org/s/#y=42689880&x=27723484&z=13&l=0&m=a&v=2

jdivision

Bulgaria is very dodgy to invest in. Use google to look for previous posts by myself and others on it.

Madong

jdivision wrote:

Bulgaria is very dodgy to invest in. Use google to look for previous posts by myself and others on it.

he's right! do you realise you will never be able to sell your investment to the local market ? as the average salary would be the price of a pint in DUblin, you'll be relying on the overseas investor if you sell up in the future (limited market)! also I'm sure you investiagted title and if the resort "had" proper planning permission and what not! don't want to be a drag, but sun and sea and a few beers make people do crazt things!

Can't wait to see one of these overseas adds advertising Iraq or West Africa on TV lmao! people have gone potty here!

chump

It's a shame the OP hasn't returned to respond to the queries and doubts put forward here.

daveball

chump wrote:

A few questions for you - thanks for your help?

What are the tax rules regarding rental income from destinations like these?
What is the gross yield on the place you bought?
What are the figures and information you have that have substantiated these figures?
What interest rate mortgage and LTV did you take out?
What is the market for selling 2nd hand properties there?
Is there stamp duty?
Is there capital gains tax?
Does Ireland have a double taxation agreement with them?
What is the yearly climate like there?
What is the supply of new apartments like there?


Cheers, very interested in this.

The rental income is applicable and as far as I know would be paying tax, I wont be renting them out.
They forecast between 8% a year
The interest rates are from 6 to 8 percent so I remorgaged at home where its a litttle cheaper http://www.bulgarianhomeloans.com/mortgage_categories.php
2 % stamp duty of the total price although the devolpers do notdeclare there full selling price, usually 20 percent underneath it.
There is capital gains tax but if you dont sell the property within 5 years you are exempt.
As far as I know the climate is approx 30 c for the summer months and average of 4 degree threw winter.
There is a market for 2nd hand properties but as 85 percent are selling new ones and speculating on them the majority are buying knew for obvious reasons.
There are a lot of devolpents especially in Sunny beaach there are some 50 new devolpements
And I wooden mind the rumours about there wages beeing 300 a month, I know several bar men on 3 times that.
Never mind the black cloud remarks about selling , I actually put in offers for several that were for sale and was in a bidding battle so the compition is there, I just found it easier to buy a new one.

Hope this helps

Do-more

daveball wrote:

2 % stamp duty of the total price although the devolpers do notdeclare there full selling price, usually 20 percent underneath it.

Ah so your encouraging us to be complicate in tax evasion!

Apart from anything else I believe that warrants an immediate ban from boards....

jdivision

It snows in Sunny Beach in the winter. Lot colder than 4 degrees. Also no mention of local mafia looking for protection money or non-appearance of "guaranteed" rental yields in many cases.

jackal

It sounds like the OP is using it as a holiday home rather than an investment. He is not planning to rent it out therefore who cares what the yields are. A holiday home for 40k is decent (are you sure you did not leave out a 100 there?).

The only way I can see this not meeting the OP's expectations is if the apartment literally is never built and he is 40k out of pocket, if the place turns into a mafia controlled dive, or if he needs to sell down the line and cant.

Completely different considerations than your average 'savvy irish investor'.

Persius

daveball wrote:

...
2 % stamp duty of the total price although the devolpers do notdeclare there full selling price, usually 20 percent underneath it.
There is capital gains tax but if you dont sell the property within 5 years you are exempt...

You may be exempt from Bulgarian tax, but you will still have to pay CGT in Ireland on any profit from the sale, assuming you are still living in Ireland.
And, the fact that you originally paid 20% more than the price on the deeds means that you will be charged CGT on that 20% even though it's no gain.

jmayo

Persius wrote:

You may be exempt from Bulgarian tax, but you will still have to pay CGT in Ireland on any profit from the sale, assuming you are still living in Ireland.
And, the fact that you originally paid 20% more than the price on the deeds means that you will be charged CGT on that 20% even though it's no gain.

Yeah and could also someday end up like the VAT debacle in Spain.
If government come looking for their Vat then who is around to pay it, the buyer.
Oh and when the OP bought, I wonder did he have to transfer the money to the developers/agents Hong Kong bank account or the like?
Sounds very much like the speil I go from Cork based agent about tax implications and of course it was saving the buyer money.
Yeah right. The developers are such altruistic people.
I was told that everyone is doing it so what's my problem.

Pa ElGrande

For those of you still thinking of buying in Bulgaria, here is some recent information printed in the English-language Bulgarian newspaper, The Sofia Echo. The comments have already been made regarding Bulgaria as an investment, but even buying a holiday home does not make economic sense in the current market, especially when this is peak season for the Bulgarian market.

Apartments in Bulgaria's coastal reseorts remin unsold
02 Jul 2007

More than 100 three- and multi-bedroom apartments in Slanchev Bryag (Sunny Beach), Elenite and Dyuni Black Sea summer resorts have remained unsold for months, real estate website imoti.net said on June 21.
According to the website, which focuses on Bulgarian real estate sector, this was a clear sign of stagnation in the market for big apartments in the leading resorts on the Bulgarian southern Black Sea coast.
Imoti.net quotes Dinko Slavov, sales manger of Bulgarian Properties, who said that indeed stagnation existed but it was affecting areas in resorts far from the coastline. “Large vacation properties are being bought by wealthy investors, who are ready to spend at least 100 000 euro, but they look for luxury properties and buy apartments next to the sea,” Slavov said.
According to Dobromir Ganev, manager of real estate company Foros, “as a rule big vacation properties are hard to sell, because they are expensive”.
Ganev said, as many had predicted for years, that “the supply in Slanchev Bryag already exceeds demand”.

Hotel's in Bulgaria halve prices, unable to reach their capacity
12 Jul 2007

Bulgarian hotel owners have been forced to halve prices so that they can reach full bed occupancy.
The truth of the current situation at Black Sea resorts is open to dispute, but it is true that some major hotels have already reduced their prices by 45 per cent, State Agency for Toursim (SAT) head Anelia Krouskova said as quoted by mediapool.bg.
Kroushkova said that it was difficult for hotel owners to pay their debts but at the same time they will be able to increase prices by five per cent next season.
Over-construction in Black Sea resorts is also affecting the quality of service, Kroushkova said. Some hotels complained that 50 per cent of their bed base remained unbooked.

Saturation of supply 'ruining' property market in Bulgaria's Bansko resort
18 Jul 2007

There is more than enough property for sale in Bansko, but interest in buying any is dwindling fast, according to a report in a Bulgarian newspaper.
The property market in the mountain resort town has been at a standstill since the beginning of 2007. Investments worth millions were blocked, Pari daily reported.
Real estate agencies were already closing their offices in Bansko because of lack of demand, the newspaper said.
Investors are finding themselves forced to cut prices to the unusually low levels of 500 to 900 euro a sq m.
Locals who received property as compensation for land sales but are failing to earn sufficient revenue from rents, are also offering properties for sale, further saturating the market.

A Sparse, Bitter Harvest in Bulgaria's coastal Resorts
23 Jul 2007

At a briefing for journalists on July 11, State Agency for Tourism (SAT) chairperson Anelia Krushkova said that excessive construction in Bulgaria’s Black Sea resorts had started producing negative results.
Hotels along the Black Sea coast had cut room tariffs because less than half of their rooms were occupied.
Only the hotels on the first rank near the beach were satisfied with their occupancy levels, Krushkova said. In spite of all this, more hotels were being opened at the seaside.
However, Krushkova said that she had received contradictory information: some owners of Black Sea hotels were said to be satisfied with guest numbers. In addition, going by reservations, enough tourists were to visit by the end of summer 2007.

The_Conductor

Replace Bulgaria with Ireland- and you have a similar story. Hotel occupancy rates are only in the low 60s% for west of the Shannon and more are opening. As for apartments- they're entirely unsaleable......

JuJuYNWA

jdivision wrote:

Bulgaria is very dodgy to invest in.

Bulgaria is very dodgy full stop, infact I would say its a proper s**thole.

I was there last year and the thing I will remember most is the amount of Lada's that are in use around the place.

Poverty is everywhere, organised crime is everywhere, gypsies are everywhere, and 14 year old taxi drivers that drive like possesed maniacs without a seatbelt around hairpin mountain corners are everywhere!!!

I had a brilliant time there but the place is a fookin kip! I will never return.

Hobky

Another returning Bulgarian traveller with gushing reports attached.....

http://www.askaboutmoney.com/showthread.php?t=60149

OP found out as being a VI half way through....quite funny