New property purchase rules postponed
09 January 2010
Bulgaria - A proposal directing that all property purchases be made exclusively via bank transfer has been postponed until the spring, although the exact date is yet to be determined. Initially, the measure, outlawing all payments in cash, was due to take effect from January 1 2010, Dnevnik daily reported on January 5.
The scheme had been approved only on first reading by a Parliamentary commission.
"In the best case scenario, the bill could be passed on second reading by the end of January," Iskra Fidossova, head of the legal affairs committee in Parliament, said. "Most likely, the law will come into effect in May or June 2010."
The measure aims to bring transparency to the real estate pricing sector and thwart fraud, according to Justice Minister Margarita Popova. If implemented properly, the scheme would "boost revenue for municipalities, increase the banks’ influence over deals and reduce interest payments on loans," Popova said, cited by Dnevnik.
For example, it is essential that the law enforces the notion that in the property disclosure form, the appraised value of the property reflects the actual price of the transaction.
Real estate deals more than doubled in December 2009, compared to October and November, and trebled compared to August and September, Dnevnik reported, citing statistics from different brokers and real estate agencies.
The reason for the sudden pike was thought to be alarm from sellers and buyers that the new amendments were imminent. This would have seen properties re-appraised and evaluated at a considerably higher value, meaning that both sellers and buyers would have been burdened with higher taxes.
Source: Property Wise Bulgaria
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