After several years of intensive construction and a strong investment cycle, Serbia’s real estate market continues to expand. This is confirmed by official data showing that the value of construction works in the final quarter of last year increased by 12.8% compared with the same period a year earlier.
The Belgrade region remains the most attractive for investors, with the value of construction works rising by over 50% during the past year.
At the same time, the real estate market grew by 9% last year compared to the previous year, while the number of transactions increased by around 7%, according to official data from the Statistical Office of the Republic of Serbia. Notably, the total value of realised turnover in this segment reached €2.4 billion, the highest quarterly level since the establishment of the Real Estate Price Register.
The largest share of this total value relates to apartment sales, amounting to €1.4 billion, or more than 61% of the total. The number of sales contracts increased the most in Belgrade – by 10.9% – with a total of €768.5 million invested. In Kragujevac, the number of transactions rose by 5.8% compared to the same period last year, while Niš recorded a decrease of 6.5% and Novi Sad a decline of 8.7%.
A significantly smaller share of total real estate turnover comes from house sales (€189 million) and commercial premises (€109 million, or 5%), while €176 million was invested in construction land and €73 million in agricultural land.
Domestic investors replace foreign ones in commercial real estate
Although the residential segment remains dominant, commercial real estate continues to hold a significant share of the overall market. According to expert estimates, investment activity last year reached €340 million, roughly the same level as the year before. Despite the lack of growth, this indicates market stability, which experts view positively.
However, the structure of investors in this segment has changed significantly. The share of foreign investors – previously around 70% of the market – has fallen to about 40%, with domestic players taking the lead. The strong contribution of domestic capital is particularly visible in reconstruction and optimisation projects, which increase property value.
Real estate consultant Nikola Đogatović explains that one reason for the decline in foreign investors is that domestic entities were often already part of ownership structures, partnering with foreign investors. Another reason is that foreign investors tend to focus on large-scale projects with higher profit potential – projects that are currently less common than before.
“When retail parks began to be developed 16 years ago, both domestic and foreign investors were involved, often in partnership. Foreign investors gave a major boost, transferring knowledge, recognising potential, and initiating the entire process. They were able to see the bigger picture and future market needs. A good example is New Belgrade, which was once not recognised for residential or business development. Today, after the construction of business facilities, it has become the main headquarters for many companies,” he explains.
Foreign investors typically enter projects larger than 10,000 square metres and focus on high-quality assets, backed by significant capital and expectations of higher returns. Domestic investors, on the other hand, tend to engage in projects up to 5,000 square metres, with their growing market share driven by the clear potential of the local market – particularly in office space.
Experts estimate that the commercial real estate market across the region suffers from a limited supply of ready-to-use office space, a shortage that is especially pronounced in Serbia. Compared with similarly sized cities such as Bucharest or Budapest, which have two to three times more office space, Belgrade still has considerable room for expansion.
“There is always something happening in the market. One example is the sudden conflict in Ukraine, which brought many IT companies. At that time, they were looking for thousands of square metres of office space, and we managed to meet that demand,” the expert adds. In the coming years, a significant expansion of office space is expected, with around 30,000 square metres planned for construction this year alone.
Decline in foreign investment
According to data from the National Bank of Serbia, net foreign direct investment (FDI) during the first eight months of last year fell by as much as 54% compared to the same period a year earlier. By sector, inflows declined primarily in non-tradable sectors such as mining (down 80%), construction (down 70%), real estate activities, and administrative and support services (both down 85%), according to NALED’s report –‘Macroeconomic Outlook of Serbia for 2026’.
By the end of the third quarter of 2025, FDI reached only half of its 2024 level, amounting to 3.8% of GDP or approximately €2.5 billion. By country of origin, the largest decline came from China, followed by European countries outside the EU, while FDI inflows from the EU remained broadly stable.
Compared to CEE8 countries, Serbia had a significantly higher FDI-to-GDP ratio over the previous three years, averaging around 6%. These relatively high FDI levels, combined with substantial public capital expenditure, offset significantly lower domestic private investment. However, this development model has weaknesses, particularly in the event of a slowdown in foreign capital inflows, which can be volatile and influenced by external factors such as global trade policies or rising geopolitical tensions.
Record number of building permit applications in 2025, but slower processing
In 2025, a total of 162,746 building permit applications were submitted in Serbia – 6% more than the previous year. The value of projects also increased by a similar margin, indicating continued growth in investment activity. The number of permits issued for buildings rose by 7%, while permits for other structures fell by 3.3%.
Local governments recorded a slight decline in efficiency, with the share of resolved cases dropping from 97% in 2024 to 94.6% in 2025, according to NALED’s latest analysis based on data from the Business Registers Agency. The largest increase was recorded in requests for location conditions, with 20,923 applications submitted – nearly 8% more than in 2024 and the highest in the past five years. The best results were achieved in the final quarter, suggesting positive momentum is likely to continue into 2026.
Insufficient supply of logistics centres
The intensification of international trade and the arrival of foreign companies in recent years have increased the demand for logistics centres. Although there is no official figure on the total number of such facilities in Serbia, market experts say the current supply cannot meet demand. Last year alone, more than 70,000 square metres of new logistics and industrial space were built in the capital and its surroundings – still insufficient for demand estimated at several hundred thousand square metres.
While Belgrade dominates in the number of such facilities – reflecting a broader European trend of concentration around major cities and key transport corridors – there is a noticeable expansion of the logistics network to other cities such as Novi Sad, Niš, and Kragujevac. Investors are particularly interested in modern logistics centres that require advanced infrastructure.
Given that logistics is now critical infrastructure for modern business – affecting product pricing, speed to market, and economic resilience, as seen during the coronavirus pandemic – its future development will largely depend on new technologies. The Serbian Chamber of Commerce states that the sector’s future will undoubtedly be shaped by autonomous systems, digitalisation, and artificial intelligence.
Belgrade to get 15 new hotels
In recent years, Belgrade has become an increasingly popular destination for luxury hotels. This trend is driven by tourism growth, the arrival of foreign investors, and rising demand for high-quality accommodation. Following the arrival of the prestigious St. Regis brand, global hotel chains have continued to show interest. The Ritz-Carlton and InterContinental hotels are currently under construction and are expected to open in 2027.
Additionally, around 15 new hotels are currently in various stages of development in Belgrade, expected to provide an additional 1,500 rooms by 2027. The city currently has 120 hotels with nearly 8,000 rooms. By the time of EXPO 2027, there will be 20 more hotels with 2,000 additional rooms, and the market is expected to grow by 20% by next year.
The exhibition is expected to attract between four and six million visitors, with participation confirmed from over 130 countries. Further momentum for luxury hospitality development comes from Belgrade’s growing role as a regional business and conference hub, which drives year-round demand for accommodation. Around 500 business events are held annually in the city, bringing tens of thousands of participants through this segment of tourism.
(NIN, 21.04.2026)