Forecast2024: Better to wait for those who are contemplating about mortgage.

Good news is coming from bankers: next year, a decrease in inflation and interest rates is expected, including for mortgage loans. The real estate market in many countries of Southeast Europe has suffered from a crisis caused not only by inflation, the war in Ukraine, and the energy crisis, but also by the fact that in many countries there is a dependence on credit buyers. This does not apply to Serbia, which is not dependent on credit buyers and has many cash buyers.

At the same time, the domestic commercial real estate market remains attractive to foreign investors, especially for the development of logistics and industrial properties. According to expert studies, up to 70% of apartments in Serbia are paid for in cash, and prices per square meter are still dictated by inflation, rising construction material costs, and a labor shortage. Currently, real estate prices in Serbia are stagnating, and no one can accurately predict what they will be in 2024.

However, good news comes from bankers: next year, a decrease in inflation and interest rates is expected, including for mortgage loans. These are just some of the conclusions drawn by participants of the "Balkans Property Forum 2023," organized by Property Forum and the Royal Institution of Chartered Surveyors (RICS) in Belgrade.

Real estate prices depend not only on demand but also on inflation in Europe and actual purchasing power, and currently, prices for all types of real estate in Serbia are at their peak. In recent years, around 20,000 apartments have been sold annually in Belgrade, which is a relatively small number, but sales in 2023 have significantly decreased, not only due to inflation and high prices but also due to unfavorable interest rates on loans. The demand for mortgage loans is currently stagnating, considering that many of them are tied to Euribor.

The crisis is not having a significant impact on the industrial construction sector. Serbia remains very attractive to international investors, as it offers opportunities for building commercial, logistics, and industrial facilities under favorable conditions. According to Petar Kolognat, the business development director of CTP, Serbia has occupied a very appealing position in the market for investors in recent years, especially regarding industrial properties. Serbia has enough land, which is one of the reasons why we are actively working in the Serbian market. New industrial zones are being developed in Belgrade and Novi Sad, zones are being planned in Niš and Jagodina, and there are plans for the development of new industrial parks in Novi Sad and Jagodina, so that we remain competitive in offering manufacturing spaces in areas with a sufficient workforce.

Another problem facing the real estate market in Serbia is the inability to meet the requirements set by the European Union's Green Deal. "Specific amendments to the Law on Planning and Construction require a mandatory green certificate. This means that residential properties without energy passports must obtain them and make certain investments to achieve a specific level of energy passport," reminds Daniela Ilic, president of the National Association of Appraisers of Serbia.