WAITING LISTS, prices will not fall so fast!
WAITING LISTS
Prices will not fall so fast, and if you think you have found the ideal property, you will be competing for it with a few more buyers
Demand is still higher than supply, and if a good opportunity appears on the market, it often happens that due to more offers, a higher price than the initial one is realized
Recently, there has been a slight slowdown in real estate traffic, according to experts who say some buyers are no longer willing to buy real estate at unrealistically high prices, but on the heels of announcements of falling prices - coming from more developed European countries - have decided to postpone the purchase and wait for the situation to develop.
Boro Vujović from the Zagreb agency Opereta nekretnine points out that many buyers and sellers currently have unrealistic expectations: while some are waiting for the fall in prices, others are trying to sell their properties, especially second-hand ones, at prices they form according to some rumors.
In Zagreb, according to the data of the State Statistical Office, there has already been a slight drop in prices: in the first quarter of this year, apartments were sold 0.3 percent cheaper compared to the period from October to the end of December 2022. Can we expect a further drop in prices?
The Croatian real estate market, in relation to the global one, reacts later, I would not talk about the fall in prices in the fall, possibly we could talk about certain changes at the end of this or the beginning of next year. However, we cannot say that prices will generally fall, but for individual properties they will have to be corrected. Primarily I think a good part of secondary, that is, second-hand real estate. We do not expect that the average realized price will be corrected, but only the requested prices, which are often set unrealistically high - says Vujović, adding that the development of the situation also depends on the tourist season, ie domestic buyers who often buy apartments in the capital with cash after the season.
On the Zagreb market there is a chronic shortage of studios, small one and a half bedroom apartments and three-room areas of 60-65 square meters both in new buildings, but also in old buildings that have been maintained and where apartments have been adapted or at least maintained.
Locations that are of interest to customers are the tram zone, the proximity of colleges, but also neighborhoods well connected by rail. So, Trešnjevka, Jarun, Vrbani, Špansko, Malešnica, parts of Novi Zagreb, Bundek, Maksimir...
Nevertheless, this does not mean that there is a lack of activity. In Zagreb, demand is still higher than supply, Euro-interiors already have clients who come from tourist cities in search of real estate, and when a good opportunity appears on the market in general, for example an apartment that meets most of the most frequently requested criteria, from location, area, orientation, layout and associated parking space, and has a realistically set initial asking price, there are also a few potential buyers coming in. Not infrequently, in such situations, real estate is also sold at a higher price than the initial one.
For example, Diana Perger from the Euro-Interiors agency two weeks ago brokered the sale of a 41-square-meter apartment with an attached garage, which had an initial price of 135,000 euros, and was ultimately sold to the buyer for 140,000 euros in cash because there were two other potential buyers who made offers next to it.
And Jasna Biliškov Baron from the Biliškov real estate agency recounts a similar situation.
- In Jarun we had the case of a renovated three-bedroom apartment of 65 square meters with a good layout and parking space, whose asking price was 190,000 euros. In four-five days, five, six buyers came forward and in the end it was sold for 193,000 euros. But there are fewer such situations because sellers generally start with a higher starting price, thinking that they will lower it over time, but fail to sell. But when the real market price is set, the interest is certainly higher — says Jasna Biliškov Barun.
Due to the insufficient supply of real estate in a number of agencies, there are waiting lists for certain types of real estate, and the most demanded are small second-hand apartments in the area of public transport up to 150,000 euros, one and a half room apartments in new buildings often without limit in the amount, three and four bedroom apartments for the family up to 200,000 and even up to 300,000 euros.
— There are two types of potential buyers on waiting lists; the first one signs a Mediation Agreement with the agencies, thus giving them the authority and order to actively search for the property according to their wishes and possibilities; and the second who do not want to sign this Agreement, but only leave their contacts and ask to be contacted when the offer appears according to their parameters. With the first potential customers, the desires and opportunities are far more realistic and they are certainly given preference over these others who have chosen the service of “passive” demand. It sounds harsh, but in a situation of lack of real estate it is the only way we can protect the interests of our buyer in an already chaotic market - says Diana Perger.
In the former, he adds, most often one buyer comes to one apartment, while in others there is quite a bit of chaos for both customers and the agency.
— It is necessary to inform such buyers at the same time, provide them with a tour of the property as soon as possible and sell it to the buyer who offers the best conditions and the highest price. There is a figure of three to four potential buyers per property, and if that property happens to be advertised, the figure rises to five to six potential buyers - he says.
Boro Vujović adds that interest in the most sought-after type of real estate, a small apartment in the wider city center, is growing to the figure of 100 potential buyers, and we were also interested in the recent data presented by Jasna Biliškov Barun, that as many as 300 buyers are waiting for a new building in Zagreb. This interest, he says, is still somewhat less today.
— Demand for new construction has weakened slightly in recent months, as prices are high. On the outskirts of the city they are at 2500 euros per square, in Klara they are already at 2600 euros per square. At the moment, we cannot say that everything is sold “as soon as the shovel is buried,” he says.
As for second-hand apartments, she adds that the database of her agency currently has 500 customers for Zagreb alone, of which in the last month, two are active in demand. However, if we talk about small apartments, they, if they are not in the basement or attic, are sold in record time, regardless of APN, inflation and increased cost of living, and often do not even get to advertise through an agency.
The structure of customers on waiting lists
— overbuyers, i.e. customers who want to buy an “opportunity” and make money on it. Such buyers, who want any type of property that is at least 30 percent cheaper than the current market price, have the most, but no offer
— buyers looking for a small used apartment to live or invest in the tram zone up to 100,000 euros
— buyers looking for three-bedroom apartments of smaller area in a new building, not necessarily in the tram zone, up to 200,000 euros
— buyers investors looking for an attractive plot for the construction of residential buildings up to 18 percent of the value of the plot in relation to the value of the entire project
— buyers looking for land or an old object for renovation or demolition for the purpose of building a family house up to 100,000 euros
* data from the agency Euro-Interiors
Complications in the market due to the strike
The strike by court workers, which has been going on for a month, has not only threatened young families who buy real estate through APN incentives, but also all other buyers who take out housing loans. That is, due to the suspension of the work of the courts, they cannot register a mortgage on real estate, so many are threatened with the termination of the contract of sale and the loss of a down payment. We learn from real estate agencies that there are numerous complications, and rush notes are written in a hurry, which are handed over to the courts in person by agents or through notaries. Unfortunately, reactions are absent, which leads to frustration in both the buyer and the seller due to the approaching deadlines for the first payments. Fortunately, in most cases, slightly longer terms have been agreed with the APN compared to the usual 60 days as with regular housing loans that, if they have expired, are “on hold” at the moment. However, our interlocutors point out that they do not know what will happen if the strike continues in the autumn.
published on 15.07.2023 years