Serbia, Investors are delaying the start of construction

Due to the unpredictability of real estate prices on the domestic market, a large number of investors are delaying the start of new projects, which may contribute to a further slight increase in prices in the next year, according to real estate agencies.

The director of the Art Nekretnine agency, Uroš Jovanović, told Tanjug that in the previous two years, the market had recorded such a growth and jump in prices that in some Belgrade municipalities the prices were increased by 100 percent.

“The second wave of price increases could be linked to the beginning of 2022, which is caused by the war in Ukraine and the arrival of Russian citizens, with the fact that, according to our estimates, even the people coming from Ukraine are primarily Russian nationals with Ukrainian passports”, Jovanovic said.

He states that the number of building permits issued, according to the last cut, in December is 20 percent lower than before due to the great unpredictability of the market.

“Investors have paused construction because they are not ready to adequately form the price. In the long term, in the next year, we will have a reduction in supply in new construction, while there are still no indications of declining demand, which is quite healthy”, says Jovanović.

He is of the opinion that there is no rule in terms of square footage preferred by Russian citizens, so both family apartments and studio apartments come into consideration.

As he says, the percentage jump in prices is difficult to generalize because it is not the same in all city municipalities.

“Demand is slowly spilling over from the central city municipalities to the peripheral settlements of Braće Jerković, Mirijevo, Karaburma, which has caused an increase in prices in those settlements, and in some cases they have jumped by 100 percent compared to the period two years ago. Two years ago, the price for Mirijevo was about 1,000 euros per square meter, while now it goes up to 2,000 euros, which is not the standard, but some luxury apartments manage to be sold at that price as well,” Jovanović told Tanjug.

He pointed out that in the last six months we have had an increase in the number of cash buyers compared to credit buyers, which is quite normal, as he says, due to the current situation on the financial market where interest rates and bank margins have increased.

“Since the beginning of this year, a significant number of Russian citizens have appeared as buyers, who rented apartments in the first waves in March of last year. Most of the leases of apartments in which the subjects are foreign citizens were for a one-year period, so their leases are now starting to expire , and the prices they paid are enormous, and it is likely that they will now appear on the market as buyers,” said Jovanović.

At one point last year, he remembers, 15 Russian citizens were waiting to look at one apartment, while the owners of the apartments changed the prices from case to case, and the price was sometimes 30 to 50 percent higher than the advertised one.

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