Real estate developers delaying planned projects

Due to the unpredictable real estate prices on the domestic market, a large number of investors have postponed the implementation of new projects.

The number of issued building permits is falling, and this may contribute to a further slight increase in prices in the next year, say real estate agencies. Uroš Jovanović, general manager of a real estate agency, said that in the previous two years, the market recorded such growth which consequently resulted in price hikes that in some Belgrade municipalities real estate prices went up 100 percent. He says that the first wave of price hikes happened in June 2020, which was the result of huge demand.

He also states that the number of issued building permits, according to the December 2022 data, is 20 percent lower.

“Real estate developers have paused their construction activities because they are not ready to form adequate prices. In the long term, there will be a shortage in supply of new real estate, while there are still no indications of declining demand, which is quite healthy,” says Jovanović.

He pointed out that in the last six months, there was an increase in the number of real estate buyers who paid in cash compared to the number of those who got bank loans, which is quite normal considering the current situation on the financial market, with the growing interest rates and bank margins.

Speaking about the influx of Russian and Ukrainian people in Serbia and the effect that has had on the Serbian real estate market, Jovanović says:” “Since the beginning of this year, a significant number of Russian citizens have purchased apartments after previously renting. Most of the apartment leases were for a one-year period, so their leases are now starting to expire. Considering that they have been paying enormous rents, it is likely that quite a few of them will now decide to buy”.

(Blic, 21.02.2023)

https://www.blic.rs/biznis/nekretnine/investitori-se-povlace-broj-gradjevinskih-dozvola-pada-da-li-sada-imamo-nove-razloge/scrqn01

This post is also available in: Italiano

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