Market expects an increase in property offering due to the introduction of property tax, but not necessarily in areas with the highest demand such as Zagreb and the coast, comments Boro Vujović, owner of property agency Opereta and vice president of the Real Estate Business Association at HGK

The introduction of property tax will not have a significant impact on the property market except that it will make part of the property owners' expenses higher than before, said Boro Vujović, a real estate expert and owner of property agency Opereta. The offer of properties will increase slightly because the taxation of short-term rents or empty apartments and houses will encourage people to activate. However, there are many properties that are not usable, do not have a permit or have unresolved real estate issues. Moreover, many properties that will be offered to the market are located in areas where there is no interest in renting or buying, analyzes Vice President of the Real Estate Business Association at HGK. Citizens may have a wider selection, but not in areas with the largest deficit of apartments, such as Zagreb and the coast, he claims. The combined effect of the increased offer, the property tax, the income tax from renting and the uncertain tourist season may reflect on prices in the following period. However, this is not looking good. “All the factors on the property market look what will happen. Buyers may think: 'A tax is introduced, it will affect the prices to fall down'. Sellers say: 'But it's not that scary, nothing significant will happen, I have no reason to lower the price'. So everyone interprets the situation from their own perspective”, Vujović explains. He emphasizes that foreigners, who make up 37% of buyers, do not consider our property prices high compared to their income. The problem is that we have "low incomes and high living costs" which makes our properties unaffordable. According to him, the price shock for property buyers will not be that significant. On the other hand, landlords will be hit harder by the increase in income tax from renting than by the property tax, he stressed in a conversation with Forbes Magazine editor Teom Johman Nitraj. Taken from: Forbes.hr

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