Floor-by-floor ownership in Bulgaria – legal basis, advantages and disadvantages

According to Bulgaria Avenue, floor-by-floor ownership is becoming one of the most popular ways of managing property in Bulgaria. On the one hand, this option makes it possible to save significantly on the costs associated with maintaining apartments. On the other, it leads to enormous problems in the running of residential complexes – electricity being cut off, swimming pools being closed, and video surveillance and security systems being abandoned. If you are unsure whether it is worth entering into a floor-by-floor ownership agreement, or whether such a decision will lead to a fiasco, take a look at our analysis of the advantages and disadvantages.

When you buy an apartment in Bulgaria, you acquire not only the interior space of the apartment that makes up the living area. The apartment plan and the price also include the so-called common parts. These are parts of the walls, staircases, windows on the floor, and entrance doors.

The percentage that the common parts make up is usually specified in the notarial deed for the property. 

As a result, if you add the living area and the common parts together, you get the area of the entire building. This building needs to be maintained, serviced and, if necessary, repaired, which costs money. Ideally, all owners of apartments, offices and premises in the building should share in the expenses. In reality, not all residents are willing to comply with such requirements. 

You can often hear things like – there is a leaking pipe on the fifth floor, but I live on the third floor, so why should I pay for something that has nothing to do with me? Or a lift button has broken on the sixth floor, so why should the owners of apartments on other floors have to pay for calling in specialists?

This kind of logic leads to a refusal to take responsibility for the condition of the entire residential building. Instead, the owners of housing and office premises embrace the idea of organising floor-by-floor ownership and take responsibility for maintaining the common areas only on their own floor. They collect money for cleaning and decide on the need to repair the staircase, the lift, and to replace windows and tiles.

Floor-by-floor ownership is set up on the initiative of the apartment owners. As soon as the relevant decision is taken, the matter moves into the legal sphere:

• The owners must choose a governing body – a committee, a management company, or a chairperson.
• The governing body must be officially registered.
• All decisions, including those relating to financial matters, are taken by a majority vote of the owners at general meetings, are recorded in documents and are binding.

The regulation of relations between homeowners and the governing body, as well as with third-party organisations, is set out in the “Bulgarian Law on Floor-by-Floor Ownership”.

A floor-by-floor ownership agreement can be concluded at any stage. If you have bought an apartment from Bulgaria Avenue at the construction stage, the agreement can be signed on receipt of Act 14, that is, when the rough construction has been completed and the construction company is beginning to prepare the building for commissioning. When buying finished property, you can join an existing agreement or initiate its drafting and signing together with other owners.

Advantages of floor-by-floor ownership

As you can see, floor-by-floor ownership is an interesting option for managing property. When living in a multi-apartment residential building, such a solution leads to substantial savings – you only spend money on covering the costs associated with the landing where your apartment is located. You do not pay for electricity consumption on other floors, or for their cleaning and repair.

But apart from savings, there are other advantages too:

• All parties to the agreement are neighbours. Everyone knows about the problems arising on the floor and is committed to solving them. Incidentally, participants in the meeting and the floor-by-floor ownership agreement can be not only the owners but also the tenants of apartments or offices, who in effect represent their interests.
• Decisions are taken quickly and effectively. The fewer people involved in discussing an issue, the easier it is to reach a compromise.
• Where necessary, the manager can liaise with the governing bodies of other floors of the residential building and jointly resolve issues affecting the whole building.

Disadvantages of setting up floor-by-floor ownership in Bulgaria

Although lawyers usually regard floor-by-floor ownership as an excellent way of managing a multi-storey building, combining benefit, order and legal soundness, it sometimes falls short.

For example, the owners of a residential building began to complain about walls freezing and increased dampness. On one of the floors, a decision was taken to insulate the walls, but the owners of apartments on the other floors did not support it. As a result, you get a residential building where the fourth floor is being insulated and plastered. The walls become thicker and brighter thanks to the new renovation. The other floors remain unattractive and cold. The style of the building is disrupted, and it starts to look neglected and odd.

Floor-by-floor ownership in gated complexes leads to even more serious consequences. In addition to the residential buildings, there are children’s playgrounds, swimming pools and park areas. By limiting their responsibility to only the landing on their own floor and refusing to pay the maintenance fee, apartment owners abandon the entire infrastructure to its fate. 

As a result, the complex’s management company declares itself bankrupt and refuses to fulfil its maintenance and repair duties. 

A striking example is Sunset Resort in Pomorie. This unique complex on the first sea line, with a huge territory, swimming pools, jacuzzis, a fitness centre and a water park, has proved unable to cover all the costs associated with servicing and maintaining the infrastructure. Now the owners of luxury apartments, who had previously been delighted at how they had managed to reduce their expenses, are forced to walk through dark corridors and staircases. The swimming pools and other infrastructure facilities will not be operating this summer.

It is unclear whether security and video surveillance will continue to function.

When taking a decision on the form of property management, Bulgaria Avenue specialists recommend taking various factors into account, such as where your apartment is located. Hasty decisions can lead to the emergence of serious problems, resolving which will require time and a great deal of money.