Real estate prices will not fall this year, according to Dejan Molnar, a professor at the Faculty of Economics in Belgrade.
“Eventually, they could slow down growth and stabilize at some level. If there are no unforeseen and dramatic events, I think that real estate prices will not decrease significantly during this year,” Molnar told Radio Belgrade 1, as reported by RTS.
When asked who are the strong buyers because of which the demand for apartments is higher than the supply in the first place, Molnar says that they can be divided into several groups.
“In the first place, these are people who have some foreign currency savings, so in these conditions of instability, fear, panic, they flee to some real goods, and in our market traditionally, real estate is considered a safe investment, because other market options are not developed. you don’t have as many choices as in other financial markets, “says the professor.
On the other hand, as he states, there are migrations of primarily younger population from rural to urban areas, from smaller to larger cities.
“There are also those who have been paying rent for a long time and understand that they could buy their own squares for the same money, especially since interest rates for housing loans are at a record low level, and all parameters by which the banking sector is assessed are good and stable. “Of course, we should not forget a part of the money gained from some illegal activities, which also traditionally ends up in real estate,” Molnar points out.
One should be careful, he says, when considering buying cash, which raises the question “where did that cash come from”, because the situation is not that simple. He says that it is mostly generated on the real estate market itself.
“Someone has a house in Čačak, Sombor, Zrenjanin … or agricultural land in a rural area, sells it, gets some cash, adds some savings to it, and provides another, missing part either through a housing loan or cash So, when someone is a cash buyer, it does not mean that he has one hundred percent of the amount in the bank, so he raises 50, 60, one hundred thousand euros and buys an apartment in Belgrade or Novi Sad. “A lot of that cash is generated by first selling something and then buying something else. That’s why such a purchase is not as much in its net terms as it is presented,” Molnar concludes.