Many owners buy a flat to let with the idea of "passive income". In practice letting is a small business: someone has to find the tenant, prepare the lease, collect the payments, react when the water heater leaks and hand the property over to the next tenant without losses. The question is not whether this work will be done, but who will do it — you or a professional.
What management actually involves
Whoever does it, managing a rental property usually covers:
- Preparation and listing — assessing the market rent, photos, advertising, answering enquiries.
- Viewings and tenant selection — meeting applicants, checking they can afford the rent, references.
- Lease, deposit and handover record with an inventory and photos of the condition.
- Collecting the rent and following up late payments.
- Bills and utility accounts — electricity, water, heating, building fees, internet; who pays what and how it is checked.
- Repairs and emergencies — from replacing a tap to an emergency plumber on a Sunday night.
- Tax — filing the quarterly and annual returns for rental income, property tax and the waste fee.
- End of the lease — move-out inspection, returning or withholding the deposit, preparing for the next tenant.
When managing it yourself makes sense
Self-management is reasonable when:
- you live in the same city and have time for viewings and emergency calls;
- you have one property and a long-term, reliable tenant;
- you have tradespeople to call and know how to prepare a lease and a handover record;
- you are comfortable keeping your own records and filing tax returns on time.
The cost of self-management is not money but time and risk. The most expensive mistakes we see are a missing handover record at move-in, vague clauses on bills, and a deposit that does not cover the real damage.
When an agency earns its fee
Professional management makes sense when:
- you live in another city or abroad;
- you own several properties and coordination becomes a part-time job;
- you want shorter empty periods between tenancies;
- the property is furnished and higher-value, so the risk of damage is greater — see also our guide Furnishing a flat to let;
- you do not want to be the first point of contact for every breakdown.
The management agreement: what it should contain
Legally, the relationship with the agency is usually a mandate contract under Article 280 et seq. of Bulgaria's Obligations and Contracts Act — the agency acts on your behalf. Anything not written down becomes a matter of interpretation later. Insist on clarity about:
- Scope — tenant-finding only or full management; which tasks are included and which are charged separately.
- Authority — whether the agency may sign the lease in your name, accept payments and commission repairs. Acting in your name requires a power of attorney with clearly defined limits.
- Repair limit — up to what amount the agency acts alone and above what it needs your prior consent, except in emergencies.
- The owner's money — which account receives the rent, how quickly it is transferred to you, and whether the deposit is held separately.
- Term and termination — minimum term, notice, and what happens to the current tenant if you end the management.
- Liability and insurance — who is responsible for a missed deadline or a badly executed repair.
How the fee is agreed
Several models exist on the market, often combined:
- a one-off tenant-finding fee — usually linked to the amount of one month's rent or part of it;
- a monthly management fee — a percentage of the rent actually collected, or a fixed monthly amount;
- separate charges for specific tasks — preparing for a new letting, supervising a larger repair, representing you before authorities.
Actual levels depend on the city, the property and the scope of service, so compare the scope, not just the percentage. Two key questions: is the percentage charged on rent collected or rent agreed (in a month the tenant does not pay, the difference matters), and are repairs invoiced without a mark-up?
On tax: if you let as an individual, taxable rental income is reduced by 10% statutory deductible costs, and actual expenses — including the agency's fee — are not deducted on top. More in our guide Letting out property: tax and the lease.
Reporting: what you should receive
A good agency gives you the picture without you having to ask. The minimum worth agreeing:
- a monthly statement — rent received, transfer date, deductions and bills paid;
- evidence for every expense — an invoice or receipt plus before-and-after photos of repairs;
- copies of the lease, the handover record and any annexes;
- an annual summary you can use for your tax return;
- periodic inspections of the property with photos — for example at the change of season, or at least once a year.
If the tenant stops paying
This is where the difference between self-management and professional management shows most clearly. The response must be quick, documented and lawful — no changing locks or cutting off the power. We set out the steps in our guide Tenant not paying or not leaving. Agree in advance who handles the communication, and up to what point.
In short
- Management is much more than collecting rent — viewings, lease, inventory, bills, repairs, tax and changes of tenant.
- Do it yourself when you live nearby, have the time and one stable tenant.
- Use an agency when you are far away, own several properties or a higher-value furnished flat.
- In the management agreement, set out scope, authority, the repair limit, transfer deadlines and reporting.
- Compare the fee against the scope, and ask whether it is charged on rent collected.
If you are thinking of handing your property to professionals, or only want help finding a tenant, call us or come into the office. We will look at the property and tell you honestly what is worth doing yourself and what is not.
This information is general and does not replace individual legal or tax advice. Verified as of October 2026.
