To many houses, not enough buyers!

[Karl]

I was speaking to a friend of mine, an agent in Porec last night and he made an interesting comment:

"offer of homes is much greater than demand"

Thinking about his comment and once again going through various property websites for Croatia, I am starting to see some properties being reduced in price.

Has anyone else noticed or had similar conversations? Croatia is a desirable place to buy and live, but has the hype been over done?

Other threads started on the board alude to the "high" property prices in Croatia, but who has been driving these prices up?

Foreign Investors trying to make a quick buck, developers charging a fortune for property - how much have these influenced the local populace to chance their arms with a riduclously high price?

Certainly a number of people buying in Croatia have perhaps paid over the odds, on the belief that prices will continue rising or that the take up of Tourism in Croatia will be greater than it is - I don't know

But Croatia is not Spain, access to the country is not great - limited flights, high prices, long travel times etc

Are the high prices putting a lot of potential buyers off at the moment as they consider their options and look at other emerging areas - Bulgeria for example. Or are people continuing to purchase in Spain and the Canaries - established markets with reasonably priced property, easy access and a great climate?

Will property prices now settle or even reduce in some areas as realisation sets in that the demand is not there at present - I hope so, partially because I move there in 4 weeks (cannot wait), partially because if people get burned now with property it could do more damage for us all in the longer term.

Is now a good time to buy? Wait until early 2005 when property has been on sale for a while and people are getting desperate to sell?

Lots of questions, but I have no answers!

All observations welcome, but please no comments about the burecuracy or food!

Karl

[Aine]

Karl

You've asked all the same questions that I would love to have the answers to - who knows what will happen?

Looking at the posts, it seems to be a land mine out there!

Do we risk it and buy now or regret it later...or vice versa?

[Crazy Horse]

I can mostly speak about prices in Zagreb as I live there, but I'm also fairly familiar with situation in coastal area.
About 3-4 years ago, real estate property prices were much lower. Then, the demand increased and prices got up very high. Contractors were making a lot of money, and, based on their previous results, they invested a lot of money in new developments. Of course, the economic output of the whole country did not increase in a way that so many can afford new properties, and the foreigners don't buy a lot still. I belive that today's prices have reached it's peak, and that due to increased supply, prices will start to drop. Now, If I had money, I'd wait a bit more and then, whehn the time was right, I'd buy a few nice properties and just wait for the new wave of increased demand. If you play your cards the right way, you could make 30-40% (even more) in the next 3-4 years.
Also, contractors today already are willing to drop their price significantly, but you'd have to talk to them directly and bargain with them. But it would be well worth it IMO.
If you in any way can, talk directly to investors, avoid agents and you'll get a good deal.

[elsanddee]

From experience, i think it's all about knowing your market. We have been looking for three years and have finally bought near Pula. Everyone says we should have bought two, three years ago, something, anything, as prices have gone up. I disagree, we have bought a property in a development, to which we have monitored prices a great deal. The price we payed this year is no more or less than we would have payed three years ago. A very common attitude of sellers is, i will sell high and if i get my price, fine, if not, then they'll wait. I have seen properties still unsold after three years, where the owners continually raise the price. Do they want to sell or not?

[yeslehc]

Get the high air fares down, then the rest of the tourist industry will benefit, not just the airlines

[alsdoubles]

Depends how short term you want to think. In the UK a few years ago I couldn't give my property away. In 2004 I sold it for stupid money and bought in Croatia for beach hut prices.
How fast do people want to see there investment double. Ten minutes. A month, a year? How scared are UK buyers right now with their huge investments held to ransom by 1/4% rises in interest rates that freeze the market? Post 2007, if all plans go to plan, people will kick themselves if they have not done it in Croatia. They may not get a second chance. Croatia is not and never will be, we hope...Spain. Maybe.

[Anja]

I do not think prices in Croatia would fall, as I (mostly) do not see owners very desperate to sell.

While two-three years ago the owners would just like to 'get rid of that old house', nowadays I can notice they prefer to redecorate themselves and then sell.

[Boris]

Apparently BA will be flying into Split three times per week as of next summer and most of the major tour operators will be increasing their charter capacity significantly. This will undoubtedly ease transport issues from the UK. For what it is worth I think the market is hugely frothy and at the same moment in time some people are getting great deals and some people are getting their fingers burnt. It all depends on how well you buy! What the hell do I know ...