What changes can we expect in the real estate market when real estate tax is mentioned?
Since the ruling came out with a new proposal on real estate tax in the real estate agency Euro-interiors, we have received a large number of inquiries from our clients both sellers and buyers, but also investors.
Everyone is interested in the same question Will the property tax bring a drop in real estate prices?
We at the Euro-Interiors agency, like no one else, have no magic ball and do not know what will happen to real estate prices. What we do know is, that the real estate market is quite lively, and that autumn is always the time when the market gets extra lively. Here we are not only talking about the sale of real estate, but also about the increased number of inquiries for renting real estate, especially apartments. When we talk about real estate tax and apartment rental, we certainly expect a bigger change in the future. Mainly for the reason that the taxation rate of short-term rentals will change. We all agree that the rate of taxation of short-term rentals of so-called tourist rentals was really low, and that until now the owners of real estate often rented them in tourist huts during the tourist season, and in the rest of the year they gave them to long-term rentals. Now, however, this should change a little, and those owners who have so far operated under this model (short-term rental in season and long-term lease out of season) will have to decide which of these two models they want to apply. Certainly, a part of real estate owners, especially in continental Croatia, especially here I mean the city of Zagreb, will opt for long-term rental, and thus the number of properties for rent will increase. On the other hand, when we talk about empty properties and HEP data as there are in the City of Zagreb, it is certain that some of them will also decide to rent their properties. On the other hand, we have a higher demand than the supply, so we think that these properties will find their tenants relatively easily, especially since many students from other parts of Croatia come to Zagreb.
Also a big change will occur in the categorization of apartments in particular. Those owners who want to engage in tourist rental will have to obtain the consent of the tenants, 80%. From experience I can say that it will be very difficult to get the signature of 80% of tenants. Especially for the reason that it does not even suit most tenants that strangers enter the building, that they ring at night because they forgot the code for the front door, etc. Quite a few such apartments are located in apartment buildings where each apartment does not have a common water meter, so water consumption is higher, the staircase is more untidy and a number of other problems that arise for apartment owners in buildings where one or more apartments are used for tourist rental. In addition, we are all a little more relaxed when we are on vacation, and therefore a little louder,... Since it is in the bill that the acquired rights will not be changed, this will not apply to those who in residential buildings already carry out tourist activity and have categorization, but it could apply to those who would like to acquire this right. We at Euro-interiors agency met with the sale of such apartments, where along with the apartment was sold a well-established tourist rental business, where a high booking rating also brought a higher price of real estate. Now that could change too.
When we talk about investments, we also expect changes there. Recently, and especially on the coast part of new apartments has been bought for tourist rental, now this is likely to change, because every potential buyer must be aware that if he wants to engage in tourist rental he must obtain the consent of the tenant.
When we talk about the tax on empty properties and the amounts mentioned, I certainly do not see how and who will determine how much tax who should pay. Perhaps the fairest thing is for property tax to be paid according to the value of the property. It is certainly not right to be paid the same according to the square footage, because we all know that a house in Slavonia and a house in Dalmatia do not have the same value. In addition, many owners of houses in Slavonia would be happy to sell their properties, but unfortunately there are not enough interested buyers for them, so they are empty. Most often, this is about inherited real estate. There are also those who do not have regulated property-legal relations, or there are several heirs who cannot agree on what to do with the property, so it stands empty.
There are certainly a lot of doubts, and to all those who call us and ask us what to do we advise that if they decide to sell the property, they do it when they make the decision, and if they buy the property they do it when they make a decision about it, they have solved the financial structure and of course find their ideal home.
If you are selling or buying a property contact us with confidence! The real estate agency Euro-interiors has been operating since 1998, which strengthens you that we are your reliable partner for the process of selling and buying real estate as well as renting real estate.
published on 30.08.2024 year