Serbia’s property market entered 2026 with enough economic momentum to sustain demand, but the first half of the year marked a shift away from the broad expansion that characterised the post-pandemic cycle. Capital has not disappeared, development has not stopped and prices have not corrected materially. Instead, investors, developers and occupiers are becoming more selective, concentrating on modern assets, established locations and projects capable of generating predictable income.
That is the central message emerging from Danos Group’s first-half market assessment. Its review covers Serbia’s residential, office, retail, logistics and hospitality markets and portrays a sector that remains resilient but is increasingly divided between prime and secondary assets. The strongest parts of the market are no longer simply those with available land or rising headline prices. They are properties combining access, energy efficiency, recognised operators, flexible layouts and credible delivery schedules.
The macroeconomic setting remains supportive. Serbia’s economy expanded by 3.2% year on year in the first quarter, while preliminary data subsequently showed growth accelerating to 3.6% in the second quarter. The National Bank of Serbia raised its full-year growth forecast in August from 3.0% to 3.2%, while retaining a projection of 4.5% for 2027, when activity associated with EXPO 2027 is expected to become more visible across construction, transport, tourism and services.
Inflation has also fallen more quickly than initially expected. Headline inflation declined from 2.7% in June to 1.9% in July, although core inflation remained substantially higher at 4.5%. The central bank expects headline inflation to move back above 4% from September because of base effects and renewed pressure from energy and commodity prices. This combination—moderate growth, temporarily low headline inflation and a still-cautious monetary stance—supports property demand without recreating the cheap-money conditions of the previous decade. The NBS policy rate remains 5.75%. The August NBS assessment provides the updated growth and inflation outlook.
Financing costs are therefore central to the new property cycle. Average rates on new corporate borrowing increased during the second quarter to approximately 7.2% for dinar loans and 5.1% for euro-linked loans. When prime commercial-property yields are mostly in a range of 7.5–8.0%, the spread between asset income and borrowing costs is no longer wide enough to make every leveraged acquisition attractive. Investors increasingly need rental growth, development upside or operational improvements to justify an acquisition.
Household income is another source of support. Average net wages reached RSD 121,805, or around €1,040, in April, while the median was considerably lower at RSD 94,585, or roughly €807. Average net earnings increased by 11.6% nominally and 8.6% in real terms during January-April. Those gains are sustaining consumption and housing demand, but the gap between average and median earnings illustrates the affordability constraint facing much of the population. Residential prices can continue rising in prime locations while the addressable buyer base simultaneously becomes narrower.
Serbia’s external position has also been relatively supportive. External trade reached approximately €19 billion in the first quarter, with exports rising 7.1% and imports only 0.3%. The EU accounted for about 59% of total trade. Export-oriented manufacturing, logistics, professional services and information technology remain important sources of occupier demand, even as weak growth in Germany and other major European markets limits the pace of expansion.
The office market best illustrates the transition from expansion to selectivity. Belgrade entered 2026 with approximately 1.457 million square metres of modern office stock. There were no major completions during the first quarter, leaving supply unchanged after a more active 2025. New Belgrade remains the dominant business district, accounting for more than 1 million square metres of gross leasable area.
Demand has remained strongest for modern Class A buildings. Technology companies, professional-services firms, financial institutions and flexible-office operators continue to underpin leasing activity, but occupiers are placing greater emphasis on efficiency than on rapid expansion. Renewals account for a significant part of the market, while hybrid working has encouraged companies to reconsider floor area, layout and operating costs.
Prime Class A rents are generally positioned at €18–20 per square metre a month, compared with approximately €10–17 for Class B premises. Prime office yields are estimated at 7.5–8.0%. These levels point to a stable market, but the gap between Class A and weaker secondary buildings is likely to widen. Prime premises can benefit from constrained vacancy and rising fit-out costs, while older assets increasingly need refurbishment, flexible lease terms or larger tenant incentives.
The development pipeline nevertheless remains substantial. Danos identifies almost 120,000 square metres of new office space under development or preparation. The largest planned scheme is the Forty/B.I.L.D. Invest complex on Bulevar Milutina Milankovića, with approximately 61,000 square metres. Other projects include Bel Mondo, adding around 5,200 square metres; Delta Tower, expected to contribute around 20,000 square metres of office space; and Panorama Office, with approximately 15,000 square metres in New Belgrade.
AFI Europe remains one of the most active institutional developers through the planned West Gate/Airport City Phase 9, AFI City Zmaj North and AFI City Zmaj East projects. Other additions include Green Escape Phase III, the Delta Land development and the reconstruction of Republica Business Center.
The pipeline is large enough to test demand once completions accelerate. The key question is not whether Belgrade needs more modern offices over the medium term, but whether the market can absorb the next wave without a significant increase in incentives. Buildings linked to public transport, parking, amenities and energy-efficient systems should retain an advantage. Secondary assets with high operating costs or inflexible layouts may face downward pressure even if headline market rents remain stable.
Retail property is following a different path. Growth is increasingly being driven by regional retail parks rather than new destination shopping centres in Belgrade. Serbia added 11 retail parks during 2025, representing approximately 127,000 square metres of new space. New schemes opened in cities including Bor, Šabac, Šid, Smederevo, Aranđelovac and Požega, confirming that convenience-led retail has become a national rather than exclusively metropolitan investment category.
The format is attractive because construction and operating costs are generally lower than for enclosed shopping centres, while free parking and easy access support repeat visits. Grocery stores, pharmacies, drugstores, discount fashion, sporting goods, home-improvement outlets and food operators create a tenant mix oriented toward regular household expenditure rather than discretionary destination shopping.
Development continued during 2026 with a retail park of approximately 6,000 square metres in Bečej, where announced tenants included dm, Sinsay, Pepco and JYSK. A larger scheme is planned in Surčin, where residential construction, transport infrastructure, the national stadium and EXPO-related investment are creating a new metropolitan catchment.
Standard rents in established Belgrade shopping centres are estimated at €23–28 per square metre a month, with substantially higher levels possible for prime units. Retail-park rents are generally lower at €9–12, but the operating model can still support attractive returns because of lower construction costs and service charges. Prime retail yields remain around 8%.
The Serbian retail market is becoming structured around three formats: dominant shopping centres in Belgrade and the largest cities, fast-growing retail parks in regional centres, and neighbourhood schemes anchored by grocery, pharmacy and food services. Discount and value-oriented concepts remain particularly active. MERE/Svetofor, Mix Markt and Fix Price illustrate the continuing expansion of lower-price formats. At the same time, Idea Marketi/Mercator-S is restructuring parts of its portfolio, including the transfer of selected locations to Lidl Serbia.
This is not merely a property trend. It reflects a wider change in household behaviour. Real wages have risen, but consumers remain sensitive to food, energy and housing costs. Retail formats that combine low prices, convenient access and predictable footfall are therefore attracting both tenants and investors. The expansion of retail parks outside Belgrade is also reducing the dependence of commercial-property investment on a small number of central-city assets.
Industrial and logistics property remains the most resilient commercial segment. Serbia has an estimated 7.44 million square metres of industrial and logistics stock, of which approximately 42% is warehouse space and 58% production space. Around 2.4 million square metres qualifies as Class A stock.
Demand comes from third-party logistics companies, retailers, manufacturers, e-commerce operators and distribution businesses. Nearshoring and the integration of Serbian factories into European supply chains are also supporting requirements for modern warehouses and production facilities. Occupiers increasingly expect motorway access, sufficient yard space, loading docks, higher clear heights, fire-protection systems, energy efficiency and the ability to combine storage with light manufacturing.
Prime logistics rents are generally estimated at €4.5–5.5 per square metre a month, while smaller last-mile or specialised premises can command more. Prime yields remain close to 8%, with average vacancy estimated at 6–7%. The strongest locations are concentrated around Belgrade, Šimanovci, Dobanovci, Novi Sad and the country’s principal motorway corridors.
There are meaningful regional differences. Indicative rents in Greater Belgrade are around €4–6 per square metre, compared with €4.5–5 in Novi Sad, €3.5–4 in Niš and €3–4.5 in Kragujevac. Lower regional rents can offer cost advantages to manufacturers and logistics operators, but the investment case depends on road access, labour availability, utility capacity and the depth of the local occupier market.
The limited supply of modern industrial space helps protect rents, but the development of speculative warehouses requires discipline. Serbia’s logistics demand has expanded quickly, yet the market is still smaller and less liquid than those of Poland, the Czech Republic or Hungary. Facilities designed around a single occupier face greater reletting risk unless they can be divided or adapted for different users.
Residential property presents the most complex picture. Danos described the first quarter as liquid but increasingly price-sensitive. Official data showed transaction value approaching €2 billion, up 13.9%, while the number of contracts increased 6.2% to around 30,800.
Data released after the Danos report confirmed that this expansion was losing breadth. In the second quarter, the total market value increased another 8.1% year on year to approximately €2.2 billion, but the number of contracts fell 5.4%to 30,495. The divergence between rising market value and falling transaction numbers indicates that higher-value assets and elevated prices are supporting turnover even as fewer properties change hands. Official RGZ second-quarter dataconfirm that market concentration is increasing.
Apartments generated approximately €1.3 billion, or 62%, of second-quarter market value. Belgrade alone accounted for around €742 million in apartment transactions. Yet contract numbers declined in all four principal urban markets: by 1% in Novi Sad, 1.7% in Belgrade, 4.3% in Niš and 7% in Kragujevac.
Credit financing is returning gradually, but cash remains important. Only 15% of all property transactions in the second quarter used bank finance. For apartments, the share was higher at 34%, broadly unchanged from a year earlier. This helps explain the market’s resilience to interest rates: it is less dependent on mortgage financing than many EU residential markets. It also means that property continues to function as a store of value for domestic savings and private capital.
Quality new-build apartments in Belgrade are typically marketed at €2,500–4,000 per square metre, while premium developments exceed that range. Well-positioned resale properties remain competitive at around €2,100 per square metre or more, particularly where buyers can obtain immediate possession and avoid construction risk. At the upper end, Savski Venac and Belgrade Waterfront continue to lead, with selected premium units offered above €8,000–9,000 per square metre. The highest recorded second-quarter price was approximately €9,300 per square metre, while the most expensive apartment transaction reached €1.6 million.
Rental yields are generally estimated at 4.5–5.5%, depending on location, condition and furnishing. That is below typical commercial-property yields and close to, or below, the cost of mortgage finance. Residential investors are therefore relying heavily on capital appreciation, short-term rental premiums or cash purchases rather than conventional leveraged income returns.
The pipeline remains sizeable. Projects under construction or development include Expo Village in Surčin with around 1,500 units, Blok 26 by GP Napred with approximately 700, Pupinova Palata by Galens with 691, The One by Aleksandar Group with more than 550, Kvart 64 with 478, Danube Riverside by Millennium Team with 410, and New Minel by Galens Invest with 339. Other prominent schemes include Marina Dorćol, Victory Gardens, Lastavice II, Bel Mondo, Terminal 10 Residences and BIG Residences.
The large number of projects does not necessarily imply oversupply at the city level. Belgrade’s residential market is fragmented by location, legal status, construction quality and delivery risk. Prime resale apartments can outperform new developments because they offer established surroundings and immediate availability. Conversely, projects in weaker peripheral locations increasingly require price flexibility, phased development or stronger financing support.
EXPO-related investment is adding another layer to the market. The exhibition site, national stadium, transport connections and residential construction are raising investor interest in Surčin and the western Belgrade corridor. Infrastructure can create durable value, but some of the price appreciation is occurring before the full commercial and residential demand base has developed. Absorption after 2027 will depend on how temporary exhibition infrastructure is converted into permanent economic activity.
Hospitality investment follows the same wider theme. The planned transformation of Hotel Slavija, new Marriottconcepts in central Belgrade and New Belgrade, a Marriott property at Airport City, and an InterContinental within Delta District point to confidence in the capital’s business and tourism outlook. Novi Sad is expected to gain a Hyatt Regency and another hotel near SPENS, while Rozeta Hotel and Swissôtel are part of continued investment on Kopaonik. Projects around Zlatibor, Vrnjačka Banja and Golubac are extending the hospitality pipeline beyond the two largest cities.
Serbia’s property cycle is therefore not ending; it is becoming more demanding. Economic growth, rising wages, infrastructure spending and limited prime supply continue to support valuations. But financing costs, affordability constraints and a large development pipeline are removing the margin for weaker projects.
The first-half figures show where capital is moving: Class A offices rather than obsolete buildings, retail parks rather than undifferentiated shopping space, adaptable logistics facilities rather than single-purpose warehouses, and residential developments with credible investors, infrastructure and delivery schedules. With nearly 120,000 square metres of offices, further regional retail parks and thousands of housing units in the pipeline, the next phase will be determined less by headline construction volumes than by the ability of individual projects to secure tenants, buyers and financing without sacrificing returns.
