Buying Off-Plan Property on the Black Sea Coast: How to Check the Developer Before You Pay

The purchase of an off-plan property in Burgas or along the Black Sea coast may appear to be a good opportunity: a lower price, new-build construction, and a choice of floor, aspect, and layout. Before paying a deposit or first instalment, however, it is important to check not only the location and the visualisations, but also the legal status of the development.

The short answer is: before purchasing an off-plan property, you should check the developer, title to the land, the building permit, the existence of encumbrances, the stage of construction, and all clauses in the preliminary agreement. This is particularly important in relation to properties in Burgas, holiday developments, and construction projects along the Black Sea coast.

If you have already chosen a specific property, a sensible first step is to carry out legal due diligence in relation to a property transaction in Burgas and along the Black Sea coast before assuming any financial commitment.

What does buying an off-plan property mean?

An off-plan purchase means that the buyer undertakes to acquire a property which has not yet been fully completed. Typically, the construction is at the design stage, excavation stage, shell-and-core stage, or prior to commissioning for use.

In this type of transaction, a preliminary agreement is usually signed, and payment is made in stages. For example, part of the price may be paid upon signing, another part upon completion of the shell-and-core stage, and the balance upon completion or before the notarial transfer.

Precisely because you are paying before the property is finished, the risk is higher than in the purchase of an already completed home with an issued use permit or certificate of commissioning.

Why is checking the developer so important?

When buying off-plan, you are purchasing not only a future flat, but also placing trust in the developer. For that reason, it should be checked whether the company that is selling or building is genuinely active, financially stable, and has a track record of completed developments.

A review of the developer may include the company’s current legal status, who its manager is, who has authority to sign agreements, and whether there are any registered attachments, floating charges, insolvency proceedings, liquidation, or other risk factors.

It is also advisable to check whether the developer has completed previous projects. An attractive website or good visualisation is not enough. More important is whether the project is backed by a company with the real capacity to complete the construction and transfer the property without legal issues.

If the seller and the developer are different persons, the relationship between them should also be reviewed — for example, agreements, building rights, title to the land, or other legal grounds.

What should be checked in relation to the land?

One of the most important questions is who owns the land on which the development is being built. It is possible that the developer owns the plot, but it is also possible that the construction is being carried out on the basis of a granted building right.

Before signing a preliminary agreement, it is advisable to check who owns the land, whether a building right has been granted, and whether there are mortgages, injunctions, claims, co-owners, succession disputes, or other encumbrances.

A problem affecting the land may directly affect the security of the future transaction. For that reason, the review should not be limited only to the flat you are buying, but should extend to the entire development.

Building permit, Act 14, Act 15, and Act 16 — what should you know?

When buying an off-plan property, you will often hear terms such as building permit, Act 14, Act 15, and Act 16. These are important because they indicate the stage of construction and whether the property is progressing towards lawful completion.

The building permit is the document without which construction should not begin. If the project does not have a valid building permit, the risk to the buyer is serious.

Act 14 is generally associated with completion of the shell-and-core stage. This is an important milestone, but it does not mean that the property is ready for occupation.

Act 15 is connected with establishing that the construction is fit for acceptance. It is an important step towards final commissioning for use.

Act 16, or the certificate of commissioning for use, is critical for the actual use of the property. Without this final stage, problems may arise in relation to occupation, financing, resale, or letting.

It is important that the agreement clearly states the stage the construction has reached at the time of signing and the deadlines for reaching the subsequent stages.

The preliminary agreement — the document that should never be signed hastily

In an off-plan purchase, the preliminary agreement is the main document that either protects the buyer or exposes them to risk. It is not enough for it merely to contain the price, the property, and a deadline. It is important that it also provides for specific consequences in the event of delay, changes to the project, or non-performance.

The preliminary agreement should contain an exact description of the property, including floor, area, aspect, appurtenant parts, parking space, or garage, where applicable. The price, method of payment, and the conditions upon which each subsequent instalment becomes due must also be clearly stated.

It is particularly important for there to be deadlines for completion and real consequences in the event of delay. If the agreement does not provide for liquidated damages or a right of termination in the event of serious non-performance, the buyer may find themselves in a weak position.

If the preliminary agreement is drafted entirely in the seller’s interests, the buyer may have limited options in the event of delay, changes to the project, or problems with the construction.

Deposit, reservation fee, or first instalment — does it matter how it is described?

Yes, it does. In practice, terms such as “deposit”, “reservation fee”, “holding deposit”, or “first instalment” are often used, but the legal consequences depend on the actual wording of the agreement.

Before making payment, it must be clear what exactly the sum is being paid for, whether it is deducted from the final price, whether it is refundable in the event of withdrawal or non-performance, under what conditions the seller may retain it, and how payment is evidenced.

It is good practice for substantial sums not to be paid in cash and not to be transferred before the documents have been reviewed.

What are the most common risks in an off-plan purchase?

The most common risks relate to delays in construction, problems with the land, encumbrances affecting the property, unclear contractual clauses, the absence of real liquidated damages, changes to the project, or an inability for the building to be commissioned for use.

Holiday properties and complexes along the Black Sea coast deserve particular attention, because in addition to the purchase itself there are often supplementary agreements concerning maintenance, management, access, parking, or the use of shared facilities.

Red flags before purchase

Be cautious if the seller insists on quick payment before any review, refuses to provide documents relating to the land or the construction, offers an agreement with vague deadlines, does not provide for liquidated damages in the event of delay, or requests payment in cash.

Another warning sign is where promises made in the advertising do not appear in the agreement. If a swimming pool, parking space, view, landscaping, access, or a particular standard of completion is important to you, it should be stated in writing.

How can a solicitor help before signing?

A solicitor’s review before purchasing an off-plan property is intended to reduce the risk before the buyer pays a substantial sum. It may include checking title, encumbrances, construction documents, the developer’s company, and the preliminary agreement.

For properties in Burgas and along the Black Sea coast, it is particularly useful to carry out full legal due diligence of the transaction. You can read more on the subject at Property Transaction in Burgas and Along the Black Sea Coast — Why Legal Due Diligence Matters.

If the purchase is connected with an investment purpose, letting, or future management of the property through a company, advice in the field of commercial and corporate law may also be required.

When is it advisable to seek legal advice?

Legal advice is recommended before signing a preliminary agreement, before paying a deposit, when purchasing from a development company, when buying a holiday property, when purchasing as a foreign national, when buying property in a complex, or when the documents appear incomplete.

If you have a specific matter, you may contact the firm via the Contacts page or review further information about the legal services in Burgas provided.

Conclusion: Purchasing an off-plan property may be a good opportunity, but only if the decision is taken after proper review. Before you pay, check the developer, the land, the permits, the encumbrances, and the agreement. The most important rule is simple: documents first, payment afterwards.