Interest Continues to Grow Yearly. However, on the Other Hand, State Subsidies Have Spurred the Rise in Property Prices, Particularly in Zagreb and Along the Coast. How to Get a Flat? Why Do Property Prices Rise Exponentially? Who Are the Buyers? Why Is So Much Being Invested in Real Estate? How to Regulate the Rental Market? https://www.youtube.com/watch?v=dQx6s1vpujk Guests were: Željko Uhlir, state secretary at the Ministry of Construction and Spatial Planning, Boro Vujović, vice-president of the Real Estate Business Association at the Croatian Chamber of Commerce, Denis Ćupić, president of the Developers' Association at the Croatian Chamber of Commerce of Economy, and Damir Novotny, economic analyst. Uhlir Denies that Subsidies Have Spurred Increased Property Prices - The Market Began to Grow Much Earlier. Far More Factors Affect Property Prices. We're Here to Help People in these Surging Prices. So far, 2,900 People Have Applied. We Count That as 2,900 Families. We Expect 3,500 Requests by Friday and It's Not a Problem for Everyone to Get a Subsidy with Valid Documentation, said Željko Uhlir. - The Most Interested are in Buying Property in Zagreb and Split. We've Developed a Ranking so that We Don't Help Where the Situation is Good, Where Income is Higher, but Rather Where We Have a Problem and a Demographic Issue, and Where We Need to Encourage People to Stay in that Area, he Emphasized. Vujović Said that there's a Lot of Work in Real Estate Agencies Today. Most Buyers Want to Use Subsidies. More Subsidies Outside the City Center - The Number of Purchases and Transactions will Definitely be a Record This Month. Most Old Flats are Being Sold Because New Ones Are Mostly Already Sold or Don't Have the Necessary Papers, so They Can't Be Eligible for Subsidies. In Zagreb, it's Visible that the Further Away You Are from the City Center, the Higher the Percentage of Buyers Using Subsidies. Normally, the Ratio is 50:50 Between Cash Buyers and Those Buying on Credit, but Nowadays it's 70 to 75% in Favor of Those Buying on Credit, Vujović Said. He Added That the Biggest Problem is Obtaining a Certificate of Use, Particularly in Old Buildings. Problems with Property Ownership Documentation - We've Been Propagating for a Long Time that Everyone Should Clear Up Their Property Ownership Documentation, Uhlir Pointed out. He Warned Everyone: "You Must Have Valid Documentation for Any Business Involving Real Estate." "Certainly, Currencies Have Risen, in Part, Because of Subsidies" - They're Just One of Several Reasons, but Not the Main One. We're Witnesses to the Fact that in the Last 4 Years, Especially in Zagreb and Split, People Have Been Flocking to Short-Term Rentals. The Fact is that Interest Rates Have Dropped, and People in Our Region Are Prone to Saving in Bricks and Concrete. Simply, Anyone Who Had Some Cash Set Aside Began to Think of Investing in Real Estate. The Fact That More and More Hotel Accommodations Are Being Built on the Coast and in Zagreb Has Certainly Contributed to the Rise in Property Prices. I Think This Bubble Will Deflate Gradually. Only Quality Flats in Good Locations Will Be Attractive in the Long-Term. This Has Certainly Increased Property Prices by 30%, Ćupić Said. - The Biggest Problem with Subsidies is That They Have an Limited Duration, Vujović Said. - They Last One Month. You Have to Buy Property Now, You Don't Have Time to Look for or Negotiate Anything. This Leads to Properties Being Sold at Exorbitant Prices. Property Prices in these Buildings Will Remain High Even After the Subsidies Expire. This is the Biggest Problem. Subsidies Would Be Good If They Lasted the Whole Year. It's a Good Thing that It's Been Announced that They'll be Available Again in the 3rd Month, He Emphasized. Uhlir Said that He Can't Accept That Argument Because We Can't Say That It Would Be Better Without Subsidies, That It Would Be Better for Citizens. - What Has Definitely Led to the Rise in Property Prices has Been Going on since 2015, When There Were No Subsidies. Neither in 2016, and Property Prices Have Been Rising in Europe. Demand is Higher Than What Developers Can Build, and This is Caused by Several Other Factors. The Desire to Buy Property is Caused by High Salaries, Low Interest Rates, and Everyone Can Afford to Buy Property. And We Have Tourism, and People Buy Property to Make Money From It, Too, Uhlir Said. Novotny: Investing in Real Estate is Not Saving - The Problem Runs Deeper and Has Been Going on for Several Decades. It's Rooted in Consumers' Behavior, Psychology, and Anthropological Issues. Croatian Citizens are Traditionally Prone to Investing in Real Estate. This is Not Saving. And I Don't Agree that the Price of These Properties Will Be Higher Tomorrow. We're Getting to a Serious Problem That's Resulted from Several Decades of Flawed Economic Policies that Promoted, Encouraged, and Advertised Investing in Real Estate. This Bubble Will Deflate, and Novotny Said. - Vienna, for Example, Builds Flats in Suburbs. It Moves Over the Danube River. Just Like in Ljubljana and Munich. In Suburbs, Urban Planning Creates Favorable Conditions for Building New Flats That Are, of Course, Cheaper. That Would be Zaprešić, Velika Gorica, and Samobor for Us, He Said. - Zaprešić Would Make a Great Place for a Commuter from Zagreb, But Only If It Were Better Connected to the City Center by a Bus or a High-Speed Train. Then, the Wider Ring of Zagreb Would be Attractive, Ćupić Said. - Slovenia Has an Excellent System of Subsidies. In Slovenia, Flats Under 120 Square Meters Are Taxed at a 9.5% VAT Rate, Just Like Houses Under 250 Square Meters. And If You, as a Private Individual or a Company, Want to Invest in Rental Properties, You Have the Right to a Tax Refund, Novotny Said. Vujović: Flats in Zagreb are for the Elite Vujović Said that the Highest Price of Flats in Zagreb is 4,000 Euros. There Aren't Many, But There Are Enough People Who Can Afford It. He Also Said That His Association Has Proposed a Fair Distribution of Subsidies Across Counties, with Each County Getting the Same Amount of Funds. - We Don't Think That a Bubble is the Right Metaphor Because it Pops and the Problem would Repeat Itself. We Don't Think That This Will Happen. We Think That Prices will Reach a Balance and Won't Rise as Quickly as Before, Vujović Said. Most Construction is Happening on the Coast Ćupić Said that a Lot of Building Has Been Going on Recently, Particularly on the Coast. In Zagreb, Building Has Started to Picking Up, but the Question is Which Neighborhoods. I'm Afraid We Need to Take Other, More Radical Measures to Make Affordable Housing More Attractive, He Said. Uhlir Said that Local Authorities Have a Lot to Do. There's No More Room for Tax Cuts. Cities Are on the Brink of Collapse. Novotny Said that Instead of Investing in the Entrepreneurial Sector, We're Investing in the Real Estate Sector, Which Doesn't Generate Returns in the Short-Term. Ćupić Said that We Need to Seriously Consider Why New Property is 5% More Expensive in Zagreb Than in Vienna and 16% More Expensive Than in Ljubljana.

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