If you are a UK resident planning on buying property in Bulgaria, whether as an investment, holiday or retirement home, or to live permanently you will have to perform one or more currency transactions to complete your property purchase.

Buying property in Bulgaria is on the rise, with many people choosing it as a place in which to retire, or to invest as there are more and more opportunities for those capital growth rewards.

Here are just a few of the many reasons as popularity increases:

• Bulgaria is surrounded by beautiful coastlines, calm, clear seas and healthy air
• It‘s 4 seasons ensure you have guaranteed sunshine in the summer, and are able to enjoy the Bulgarian mountain and ski resorts in the Winter
• A variety of cuisine is offered, with menu ideas taken from its neighbours Greece and Turkey to form attractive dishes for locals and foreign travellers alike
• Purchase and living costs are substantially lower, with eating and drinking inexpensive. An average bottle of beer is less than 1 euro.
• The country entered the European Union on January 1st 2007.

A Place in the Sun Magazine - Buyers Guide offers more information about buying property in Bulgaria.

Whatever your reasons for buying property in Bulgaria, it is a serious investment, and as such requires planning, especially if you are buying a new ‘off plan’ property where you are required to make several 'stage payments' during the construction.

For illustration purposes, let us assume that you are a UK resident wishing to buy within an ‘off plan’ development. The developer will require a deposit in Lev’s or Euros straight away, and then further stage payments during the construction over the next 18 months, with a final payment upon completion. You will know the price in Levs or Euros and this should not increase unless you upgrade the specification of the villa.

The actual cost in Sterling will be determined by the timing of your currency purchase. Naturally, if Sterling strengthens during construction, the cost of buying property in Bulgaria will decline but if the Lev strengthens then your costs will increase - i.e. a stronger Lev means to it will be more expensive! (This will also apply to those purchasing a straight 're-sale' property where there is a gap between the offer being accepted and the completion of the sale).

If you have strong views about future exchange rates, you could wait to buy your currency at some stage between agreeing to buy and the date that currency is required. This applies to either buying (and paying for) all of the currency or fixing a rate. Either way you are exposing yourself to currency risk.

You would never agree to buy a property in your country of residence if you did not know how much it was going to cost you; if you agree to buy property in Bulgaria without fixing the exchange rate at the outset, you are taking a gamble.