Negotiating the Right Property Price
Before agreeing to purchase the property, it is always a good idea to negotiate the price, just as you would in many other countries in the world. If you are using an agent, then tell the agent what price you are prepared to pay for the property and the agent will then negotiate on your behalf (in theory). But do note that the agent is actually lowering their own commission by negotiating a lower price for you - which is not a good incentive for them to achieve the best possible price for you. They will of course tell you that they will get the best price for you, but what do you expect them to say! It is difficult, as it would not be appropriate for you to deal with the owner directly when going through an agent. What this means, realistically, is that you need to be prepared to walk away. Be firm, and have several properties lined up. You could also consider offering a bonus commission to the agent if they get the price you want. That way, there's an additional incentive for them.
But do your homework and have a good appreciation of the selling prices of the kind of properties you are interested in. Some unscrupulous agents may increase the price when they know a foreigner is buying; so be aware of this, and be prepared to negotiate. Many sellers in Bulgaria are prepared to sit on their property or land until the 'right' buyer comes along, so negotiation may not always work in your favour.
The Two-tier Pricing Structure in Bulgaria
You may have heard that there is a two-tier pricing structure for real estate in Bulgaria - which may be a concern to you.
With such a two-tier system in operation for hotel accommodation in the country it is no wonder that some people assume that the prices are raised for foreign buyers.
It is easy to be sceptical when you consider that the average Bulgarian salary is 139 euros a month (This figure was published by the Bulgarian Embassy, London, in 2004.). This equates to an annual salary of 1,668 euros. So, when you see properties selling for the equivalent of 35,000 euros and above, it is difficult to understand how the local residents are able to afford such properties. How many mortgage lenders in England do you know that will lend you 21 times your annual income?
During a seminar hosted by the British Bulgarian Chamber of Commerce in London, May 2004, this very question about the alleged two-tier pricing structure was put forward to the guest panellists - which included representatives from Bulgarian estate agents. Here, the notion of a dual price for real estate was categorically denied.
What is important, at the end of the day, is that you are comfortable with the price that you are going to pay for a property. If, after comparing the price of the property you are interested in with many others of a similar type, you feel that it is a fair price and good value for money - and it meets all your other criteria - then go for it!
If, on the other hand, you feel that the price on offer is just way over the mark, and no amount of negotiation is going to change that, then simply move on.
