Real estate market on the coast

[delta]

Hello,

I am a new member to this board, got to it through some random Google search.

As I am local real-estate agent working Zagreb area, I am curios to find out how are things on the coast at the moment, both Dalmatia and Istria. I guess we all had rough beginning of the year, but do you guys see any positive changes in coming months?

Thanks

[ivetron]

Delta, a theme that seems to continue to get pounded home on this board is that the coastal properties, especially in Dalmatia are overpriced. "The seller doesn't need to sell", "Seller is waiting for that Russion millionaire to shower money upon them", "Croats don't understand there is a economic crunch affecting discretionary spending". I can't comment on the future outlook but am sure you will get a reply or two from another agent. I am curious as well. I have been following property prices in the Kvarner region and they have appeared to be stable for awhile, when maybe they should be dropping??

[Carol]

I guess that means me? Or Mark? Anyway... market in the doldrums for months but some movement in last few weeks. no real trend to report except that sellers are beginning to seriously mark down their asking prices now and there is the odd buyer out there. We've (not me!) been busy all week.
Personally I think this phase will be a good thing in the long term as it is making everyone a bit more sophisticated and the agencies are more co-operative and professional with each other. In 2005 it was so cut throat...!

[mandy]

I managed to interest someone in the UK who invests in real estate abroad to consider Croatia as an option. He took one look at the prices and said I had to be joking. I encouraged him to do a bit of research which he did and he came back with the same statement only amplified.

[delta]

What I am noticing here in Zagreb is more interest from buyers then we had during first three months of 2009. However, they are mostly looking for bargains that are still not there. Sellers have lowered prices somewhat (maybe 20 % over last 12 months) , but it looks as buyers and sellers still didn't reach common grounds.

I guess in Zagreb we won't see any significant increase in sales till autumn, under condition of at least some economic recovery.

[prkbrk]

No way have prices dropped anywhere near 20% in Dalmatia- from my own casual observations I would say it has been a change of about - 0-3% at most - a guy in our village wants to sell his house for around 420k and its actual value from the local estate agents I have talked to value it at around half that - a small apartment (<50m2) in the Zadar county area will set you back around 80-90k.

Added to that the drop of around 20-25% in the Euro/Sterling exchange rate does not make Croatia or anywhere in the Eurozone an attractive option right now for UK buyers - it certainly stopped me from investing in any further property in Croatia at this time

[Carol]

some have dropped 50%, some have stayed unchanged. Most which have dropped are about 15% (I could work this out from the 300+ properties we have for sale but its just based on what i think i've seen). Mainly what we notice is developers have become more reasonable e.g. my colleague took on some nice apartments in ciovo last week for 1600 €/m2 whereas before the prices were usually around 2000 or even 2400 for such properties

[delta]

OK, so do you think there might be buyers for 1600 €/m2 flat in Ciovo this summer? Buyers from EU, Croatia, Russia,..?

[Carol]

Maybe, but I don't know. Right now there are a few buyers (who are actually buying not just looking) but as i said before there is no trend which I could use to predict the next few months. Ciovo is a special case too because of the traffic/ access problems. The new bridge is due to start construction in September/ October but right now its an inaccessible place which is difficult to get around thanks to the road works between Trogir and Okrug Gornji. Some buyers can see past all this and will buy, other's either can't or don't want to wait for things to get better.

[mambo]

Here in Istria there are a lot of people who are trying to sell their houses, but little luck so far.

The type of people who could be interested for those kind of houses are the ones who need mortgages and that is a big problem at this moment.

The ones who could afford it (put the money cash on the table) are usually not really interested in the type of houses that are for sale. They are not looking for an apartment in apartment blocks, they are looking for houses with lots of terrain etc.

Then again, also in other countries the prices have dropped dramatically and at the moment Spain is basically a Valhalla for buyers. They can buy houses with 50 to 60 % discounts and if you have money to spare at this moment Spain is of course a much safer investment than Croatia.

[ray51]

...Valhalla ?
Alas , Not ( yet ? ) Costa Brava ...

[mambo]

Ray,

Spain is really heaven on earth if you are looking for some cheap deals. A lot of houses have been taken back by the banks and they are almost giving them away. There are even deals for 1 euro and prices under 1000 euro/m2 are common.

The housing market in Spain has completely collapsed, nothing left of what once was. Of course some people are still trying to get high prices, but they won't sell.

[Aleksandra]

The reason for not dropping the prices we have been given from a few sellers is that now everybody expect to negotiate price down 15-20% so if they drop the asking price, this would mean that the offers they would be given would be 30-40% down.

CentarNekretnina.net has reported last month that the difference in average asking price (per sq. m.) on Northern Adriatic (Istria & Kvarner) is around 25% less than southern Adriatic (Dalmatia & Dubrovnik). But no doubt that asking prices of Dubrovnik area ups the average price of the "southern Adriatic".

[ray51]

May 25, 2009 22:11:32 GMT 1 mambo said:

Ray,

Spain is really heaven on earth if you are looking for some cheap deals. A lot of houses have been taken back by the banks and they are almost giving them away. There are even deals for 1 euro and prices under 1000 euro/m2 are common.

The housing market in Spain has completely collapsed, nothing left of what once was. Of course some people are still trying to get high prices, but they won't sell.

True ! Most Brits are also caught in all this , unable to sell and sufffering high CoL/inflation and low sterling ;
this holds true for almost all of the Costas ; if one believes media , then there are now over 1 million properties for sale , coastal and inland , developers going bust left , right and centre and who knows what might still happen to the banks , holding such toxic mortgages ?
However : one notable exception being the stretch from French border to Barcelona , where the prices don't yet appear to be much affected ( since there are too many still-affluent owners : natives , Skandies , Dutch , Germans , Belgians , even French , I'm told ) .

[ivetron]

Aleksandra's post mentioned CentarNekretnina.net which seems to have a good deal of property listings for Istria & Kvarner, which is the area I am interested in pursuing. I feel I am pretty good at doing a lot of the leg work when checking out property, comps, pricing, internet etc but I am not completely familiar with the Croatian process. Obviously I will need to get inside these places and check them out. Can someone give me some advice for when I show up in July? My only thought is to just pick an agent from this site and contact them directly. I will be based in the Rijeka area. Referrals are good and thanks for any feedback.