Bulgarian currency issues and how they affect Bulgarian property

Bulgarian currency is an issue you should familiarise yourself with before committing to buy your new home in Bulgaria. You will find that the cost of most Bulgarian property is advertised in Euros although the Bulgarian currency is actually the Lev (the plural is Leva and it is usually written as Lv on price labels) which is divided into 100 stotinki. To confuse things further, the official code for the Bulgarian currency is BGN.

Since 2002, the Lev has been tied to the Euro at a fixed rate of 1 Euro = Lv 1.955. Sterling and other currencies fluctuate against the Euro, so you need to bear this in mind when entering the Bulgarian property market.

General financial information and problems with Bulgarian currency market

• Banks
  Banks in Bulgaria open between 9am and 4pm on weekdays. Most foreign-exchange offices are open until 6 p.m but in the larger cities some are open 24 hours.
• Bulgarian currency import restrictions
  The import and export of Bulgarian currency is prohibited. However, the movement of foreign currency is not restricted, provided you declare it and (if its value is more than 8,000Lv) prove its source.
• Credit cards
  Bulgaria is still largely a cash economy so credit cards are not widely accepted except in some of the larger, big city stores, and in petrol stations and in hotels and restaurants in tourist areas.
• ATM´s
  ATM´scan be found in cities, towns and tourist resorts and most credit and debit cards can be used to buy Bulgarian currency. An English language option is sometimes available. Cash machines are particularly useful because of the short opening hours of Bulgarian banks.
• DCC (VAT)
  The sales tax in Bulgaria is known as DDC and is charged at a rate of 20%. It is due on most purchases of Bulgarian property where the seller is a developer or business, and you should check it is included in the price you have been quoted. DCC is not due when you buy land, or if you buy your new home in Bulgaria from an individual.

Bulgarian currency fluctuations can make your home in Bulgaria more expensive

When you buy Bulgarian property, the real cost will not become known until you have bought the Euros needed to complete the purchase. Because the Lev is pegged to the Euro, and Sterling fluctuates against it, your new home in Bulgaria could become more or less expensive during the purchase process.

If you have full funds available it is worth fixing the currency by means of buying it all on a spot contract. You would then hold it on deposit and send payments in Euros.

Many people underestimate the importance that exchange rates can have on their purchase of Bulgarian property. Bulgaria offers some good investment opportunities but the majority of individuals do not make the most of them. They exchange currency at their bank and then transfer their funds abroad. This does not guarantee the best exchange rates or protect against currency risk.

Our service directory will help you locate a reputable UK-based or Bulgarian currency specialist who can help with these matters and to minimise the cost of buying your new home in Bulgaria. Their access to exchange rates is calculated by the second, which means they can significantly undercut banks and help you save money on Bulgarian property.