Investment Property in Sofia, Bulgaria.

A Bulgarian Company has been formed to build new 3 and 4 bedroom houses in the suburbs of Sofia. They have established prestigious new offices in the World Trade Center, Sofia in which there are 8 administrative and technical staff and currently 20 (rising to approximately 60) on the building team.

On present projections they intend to build a minimum of 500 properties during 2006 alone to fulfil demand. The properties will be finished to a European standard of wood flooring, plastered (white) walls, spotlights, Ikea type furnishing, airconditioned/reverse cycle heating. The properties will be of traditional concrete shell construction and all new build.

The average accommodation will be 1-2 reception rooms, 2 bathrooms and 3 - 4 bedrooms with gardens and parking spaces.

Expected 10% Yield

Prices (at current values) will be £75,000 - £150,000 and the properties will be let on completion to waiting corporate tenants on a 12 month renewable contract at £450-£1200 a month. Yield is approximately 10% gross.

It is our aim as UK Agents to sell these properties (complete with 12 month tenancy in place) to Investors in the Buy to Let marketplace.

Methods Of Purchase

There are three methods of purchase:

• Cash / deposit off plan (up to 10% discount).
• Cash down payment and the balance on mortgage terms.
• 100% Mortgage (to your Bulgarian Company) on a non status basis.

Each Property Will Be 100% Owned by the Investor

Each property will be owned by an individual Bulgarian Company in turn owned 100% by the Investor. An example of the structure of a 100% Mortgage funded purchase:

• The Mortgage (from a Bulgarian Bank) is granted to your Bulgarian Company (formed by approved lawyers) that owns the property at 70% of valuation and 7% interest with a charge over the freehold.
• The remaining 30% at 7% interest (tracking the Bank rate) is granted by a Private Trust against the security of a second freehold charge, the shares in the owning Company and a Personal Guarantee of £10,000 from a suitable purchasing owner / investor of the Bulgarian Company.

This is not credit status related. No credit checks are carried out; the mortgage is secured against the property. Full Property Management is available at 10% of rental but it is not a condition of purchase.

Registration of Interest

Buy to Let Investors who are interested in buying property off plan, with:

• Cash
• down-payment and mortgage terms
• purchasing with a 100% mortgage

Registration Process

£5,000 must be paid to i-World Property, as our UK Agents. This will be used to form an individual Bulgarian Company, by approved lawyers in Sofia, to facilitate the purchase of any freehold property and will also cover all the legal costs and buying taxes.

This Bulgarian Company will then be transferred to the Investor complete with 2,600 Euro cash (minimum capital requirement) in their Company Bank account. This 2,600 Euro in cash can be withdrawn by the Investor at any time after the Company is formed.

Therefore, any Investor will need about £3,000 per property to participate in this offer (this also covers all legal and administration costs). The only other fees will be approx £150 to an independent lawyer to act for your Bulgarian Company, who will read through the contract and ensure the safe transfer of Freehold Title – the developer will pay all other fees/taxes.

The Investor / Company is NOT committed to buying a property at this stage. This registration procedure is a condition of purchasing property from i-World Property (as Agents) and Investors will only be offered available properties by us following this (to ensure good title to the Bulgarian Company and Freehold).

Following the registration of your Bulgarian Company (which takes about 8 weeks) the Company will be placed in an allocation queue for property.

Investment Property

Initially the developer will only be building, (to a high specification), brand new 3 - 4 bedroom houses for sale in the suburbs of Sofia.

The main reason is clear: There is a large demand for houses available for rental to Corporate Clients engaging in business in preparation for the entry of Bulgaria to the EU (2007) and after. At present there are not enough suitable standard rental houses available.

There is already a 'waiting list' (allocation queue) for properties as we make sites available, which is why the developer is making sure Investors are serious by funding the formation of a Bulgarian Company at this stage. Once the Investor has formed their Company they will be placed in the queue for the properties on a strict basis of being offered property in the same order as the Bulgarian Companies are formed.