Although there are some indications that during the third and fourth quarters of 2023, there was growth in the construction of residential housing, the question is whether that growth will continue in 2024 too, warned economist Ivan Nikolić in his analysis of domestic residential housing construction.
In the first edition of Macroeconomic Analysis and Trends (MAT) magazine in 2024, Nikolić pointed out that the acute problem of domestic housing construction lies on the demand side and concluded that there is no doubt that the contraction of demand will very quickly stop the trend of ever-growing prices of apartments.
Nikolić says that there are key indicators that the housing sector is facing a serious drop in demand.
The data collated by the State Geodetic Institute (RGZ), covering the period of the first six months of 2023, show that the total number of real estate sales decreased by 14.1 percent, that the number of purchased apartments decreased by 18.6 percent and that the value of the real estate market in the third quarter of 2023 amounted to 1.5 billion euros, which is a 10 percent year-on-year decrease.
The decline in demand is also indicated by the decline in demand for construction materials, so in the nine months of last year, the import of bricks and construction blocks decreased by 70.8 percent and roof tiles by 35.8 percent, while the value of the import of bathroom fixtures fell by 14.3 percent.
“In the previous three years, there was a ‘boom’ in the prices of apartments, especially of newly built ones. Prices also grew in 2023, although at a somewhat more moderate rate than before. Several factors contributed to this, but there is no doubt that the contraction in demand will very quickly stop this trend,” Nikolić added.
Real estate appraiser, Milić Đoković, notes that the real estate market trends in 2024 will stabilize and that more people will buy apartments with the help of a housing loan.
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