In the last ten years, the prices of new apartments in the region grew at the fastest pace in Serbia. During that period they increased by 35%. That percentage is slightly lower than the EU average, where prices rose 42%from 2011 to 2021, according to data published by Bloomberg Adria analytics. The prices of apartments in new construction grew faster in Serbia than in Croatia and Slovenia. In the last decade, the growth in the price of new apartments in Croatia was 18%, and in Slovenia 14%.
The largest increase in the price of square meters has been recorded for several quarters in the municipality of Savski Venac, where square meters are sold at a price of around 9,500 euros.
However, the demand for apartments is expected to decrease, and therefore the prices are expected to stabilize or even decrease.
One of the key factors is the rising interest rates applied by central banks in response to rising inflation, which makes home loans less attractive. In addition, banks are tightening loan conditions while the slowdown in global economic growth is affecting investment in the real estate sector, as more and more money will be spent on easing the effects of inflation.
Trends in requests for construction permits
Since the end of 2014, the number of construction permits requests have increased by as much as 553%, which strongly shows that there has been a more favorable economic environment in the last eight years.
Construction activity declined by 11.4% year-on-year in the second quarter of this year, following a 7.1% year-on-year decline in the first quarter of 2022, bringing the total year-on-year decline for the first half of this year to 9.2%.
The most expensive apartments are in Belgrade
Real estate in Belgrade is more expensive than in other regional capitals. The average price of a new build in 2020 in Belgrade was 1.741 EUR per square meter.
At that time, the average price of an apartment in Bucharest was 1.440 EUR per square meter, in Sofia 1.144 EUR, and in Budapest 2.207 EUR.
However, if the prices per square meter in relation to the GDP per capita are taken into account, the prices of apartments in Belgrade compared to the wider region are quite high. The values of the square footage measured through the share of GDP value per capita are for Belgrade 15%, Bucharest 5.5%, Sofia 5.8%, Budapest 7.8%.
*The information in this announcement does not represent legal advice and is provided for general informational purposes only.