The real estate market in Croatia has been experiencing a slight stagnation for the past few months, but experts claim that the market is still very active. The demand for apartments in new construction and apartments of around 70 square meters in larger cities or in good locations, which are constantly in short supply on the market, is not decreasing.

We spoke with Martina Naletilić, a licensed real estate agent at the Sky Nekretnine agency, who told Financije.hr that she feels a slight drop in demand among foreign buyers, but believes that this is due to the current economic situation in the countries they come from.

She revealed to us that in the next six months she does not expect significant changes in real estate prices, but a continuation of the stagnation that has already begun, i.e. price fixing.

Many buyers are not sure what kind of properties are the best to invest in and whether they should invest in them at all. Naletilić advises that it is good to invest in real estate in an attractive location or one that has the potential to become so in the near future.

“If you have a certain amount of money at your disposal, and by financial calculation you come to the conclusion that you will pay off the investment in the optimal period, investing in real estate is absolutely a wise move,” she said, adding that one should look at how attractive a certain location is to a certain group of people (students, tourists , workers…) if you are thinking about renting.

When choosing a property for housing, it is important to take into account personal needs, how close they are to important locations (public transport, health center, green areas), noise level and the layout of the rooms.

As for prices by location, research conducted for 2022 showed that the most expensive prices per square meter are in Rovinj, Opatija, Dubrovnik and Split. But what kind of properties fetch the best prices?

“If we compare the price per square meter, small apartments in good locations fetch dizzying amounts compared to real estate with a larger square footage or compared to real estate in less attractive locations. Luxury real estate, apartments and urban villas are, of course, a separate category,” said Naletilić.

Sky Nekretnin told us that when selling real estate it is important to follow the market and not exaggerate with unrealistic amounts if you want to sell the real estate in the optimal period of time.

Naletilić says that there is a noticeable constant deficit of apartments in new construction, i.e. demand that exceeds supply, which consequently affects the growth of real estate prices in new construction. However, construction costs have not been increasing in the last six months.

Destatis announced in October that the number of permits issued for the construction of apartments in Germany decreased by 28 percent in the first eight months of 2023 and pointed to higher construction costs and worse financing conditions. Naletilić explained to us whether such a situation in Germany could affect Croatia.

“The situation on the international market certainly spills over to the Croatian market to a certain extent. Although we are not immune to changes, we must not ignore certain specificities of the Croatian market, due to which we minimally feel the crisis that occurred in most other EU countries and beyond,” said the real estate agent.

“The entry into the Eurozone and Schengen and the increased interest of foreign buyers in the last year have somewhat protected the Croatian real estate market from the crisis that occurred in other countries and have minimized the negative trends that have appeared on the real estate market in most other countries,” she added.

Author: Financije.hr

As for renting, luxury real estate is doing the best, as well as luxury boats, Vujović points out.

Boro Vujović, director of the Opereta real estate agency, was a guest on Dnevnik N1 where he spoke about the reasons for the rise in real estate prices in Croatia and forecasts for the future period.

Boro Vujović explains how the increase in real estate prices was influenced by the increase in the price of construction materials:

“The fact is that interest in real estate exists. Something unexpected happened – the corona was supposed to lead to a negative correction of prices, but they started in a positive way, i.e. they went up in price. One of the reasons is inflation, i.e. the fact that states have released a large amount of money into circulation and part of the people who have funds are looking for ways to save the value of money and are buying real estate, and the price of construction materials is also rising. This year, it increased between 25 and 30 percent, and this will affect the price of a square meter in the coming period.”

He says that it is impossible to predict the limit to which prices will rise, that will ultimately determine the purchasing power of citizens.

“It may happen that the prices of materials rise, but the purchasing power of citizens does not rise. Prices can rise to the point where citizens can buy real estate. If the prices rise too much and the citizens cannot keep up with it, then we will have a stagnation in the market which is already easily visible. APN was a big demand generator in September, now it’s gone and it can be seen that the demand is lower than last year. Prices can rise, but they cannot skyrocket, because then the question is who will buy these properties”, adds Vujović.

Interested parties

He points out that foreigners are particularly interested in real estate on the coast:

“Each year, on average, about 30% of all purchases are made by foreigners. There is interest, especially after the corona and the situation that people can work from home. There is great interest in real estate on the coast, and in this context, real estate prices in Croatia are cheap compared to Germany, Austria and Slovenia. The interest of foreigners in real estate on the coast has increased.”

He adds that more luxurious real estate fares better: “It can be seen in the last period that the more luxurious the real estate, the better it fares and the easier it is to sell. There are not many such customers, but for some, money is not a problem. Properties of average value are the most represented, but there is a greater demand for luxury properties than before, but their market share is still small in relation to the overall turnover.”

Luxury properties are the best for rent

As for renting, luxury real estate is doing the best, as well as luxury boats, Vujović points out.

“The more luxurious the property, the greater the interest, and it is more difficult to find such a vacant property, even though there is not even a vacant bed on the coast,” he says, adding that there is increasing interest in the hinterland:

“There is increasing interest in the hinterland, especially in Istria. It is easier to rent a house with a pool 15 km from the sea than an apartment 15 meters from the sea. Foreigners want intimacy, isolation and not mixing with a large number of people, that has changed since the corona.”

Author: Poslovni.hr
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