While many hoped that the dizzying real estate prices in Serbia would go down during the pandemic, something like that did not happen. Prices per square meter, which have risen by more than 30 percent in recent years, have remained stable, and while the balloon was expected to burst, experts claim that it practically does not exist now.
Connoisseurs of the real estate market say that as long as there are buyers and demand, the prices are justified, and they do not see that they will come for reductions at all.
The average price of a square meter in a new building, which is the most sold, in Belgrade is around 2,000 euros. Luxury construction, but also luxury locations are much higher, so the prices per square meter in the old building will be around 3,000 euros, and in the new building much higher.
“It is unbelievable that at a time when the consequences of the corona virus pandemic are coming, in Serbia, as if nothing had happened, the corona has not moved the real estate market in our country. Prices are stable, and small apartments and new buildings are selling the fastest,” said for Blic Business Kaca Lazarevic, owner of the agency “Kaća Lazarević nekretnine”.
According to our interlocutor, prices will not go down, and according to her, easing the conditions for raising housing loans have significantly contributed to the growth of apartment purchases.
“New construction is sold the fastest because people take out loans, and now the conditions are quite favorable. Many banks have adopted the initiative of the National Bank to raise a loan with a 10 percent share, and now from September 1, mitigation measures will take place to take out a loan and when it is 60 percent of the construction, and when the Property Directorate is the holder of the construction permit, it does not have to have any degree of construction at all. It all depends on how the banks will accept and under what conditions they will give loans,” says our interlocutor.
Speaking about the justification of the high prices of new construction, Lazarevic says that they are justified because “unfortunately, investors also have huge costs”.
“On average, the price per square meter in a new building is around 2,000 euros, but it depends on the location. The state should, in addition to these measures of the National Bank, release investors from compensation for construction land, which is not small, and depends on which zone. Let’s say now the extra zone includes the wider center of the center in Belgrade, which makes the price per square meter in those parts of the city of apartments under construction much higher. Also, the terrace is now included in the square meter of the apartment,” explains our interlocutor.
She adds that the production of installations and water has become more expensive, and investors are trying to do well for such high prices, so let’s say marble entrances, marble bathrooms, and garages are in many cases very comfortable, which would not have been the case before. Old construction has fallen slightly, says Lazarevic, but the decline is not great.
“For example, apartments in old buildings cost from 1,800 to 2,200 euros per square meter in the city center. Luxury old buildings sometimes cost more than 3,000 euros, but suburban settlements can be found for 1,400, 1,500 euros, depending on what is required,” says Lazarevic.
Milos Mitic, operational director at the City Expert real estate service, also says that real estate prices have remained at a consistently high level and have not shown any change so far. However, he adds that there is a slight change in the behavior of the owners when entering the negotiations, so most of them now have a slightly more flexible attitude and are ready to negotiate the price.
Speaking about the justification of high prices, Mitic says that the market mechanism should be considered, which is very clearly defined.
“After May, demand started to rise above the supply again, and as long as that is the case, prices will probably remain at this level. The price curve will start to go downhill, according to some expectations, only from next year. For now, the state is trying to “both supply and demand, and how sustainable it is in the long run depends on many factors. One of the key ones, to which none of us has an answer, is how long the Covid pandemic will last, and of course each country’s ability to recover quickly from the crisis,” says our interlocutor, Blic reports.
