2019 went down as the worst year for the UK real estate in a decade. The markets were mainly affected by the pending premiership elections and the Brexit. While the uncertainty hasn’t fully cleared, some parts of Europe are already experiencing modest to massive gains in their real estate rental prices.
One such place is Croatia – where since last year, the market price per square meter for rental apartments has jumped by about 10%, placing the country’s rates at position three in the whole of Europe.
Some of the places in Croatia with the highest apartment rental rates include Zagreb, Dubrovnik, and Split, while the lowest priced areas are Slavonski Brod, Sisak, and Vukovar.
Analysts say Croatia is unlikely to experience more “appropriate or realistic” prices for the whole of this year.
The sector is fast recovering, and prices could rise to new highs. Coming third after Luxembourg and Hungary, Croatia has experienced a significant increase in its prices in the region. Last year alone, the state recorded more than 100,000 real estate transactions involving the buying and selling of properties.
Croatian property site HRT wrote: “Zagreb, as the capital and most economically developed centre, is actually a magnet for investment in the real estate market. Residential construction is booming. Thousands of apartments are being built. The investment boom has raised prices to more than 2,000 euros per square metre.”
Prices that properties are sold for and the asking prices are always at conflict.
“New builds, which is the leader in price growth, are quite good quality and then other real estate owners feel called upon to raise prices. We see that the market is not responding and that it is slowing down and we expect prices to stabilise,” president of the Real Estate Association at the Croatian Chamber of Economy Dubravko Ranilovic said.
Counties that registered the most significant price increments were Istria and Split-Dalmatia.
The coastal part of Croatia has been one of the most sought-after areas by real estate investors, and about 20% of properties in the area are owned or purchased by foreigners.
But funding remains a huge challenge for most Croatians, despite subsidies and favourable loans. With an average salary of 6,464 Kuna (£744) as of March last 2019, only a handful of the country’s citizenry can afford decent apartments.
1 Croatian Kuna=0.12 Sterling Pound *