Housing prices down again in August

Sep

2010

Written by Administrator

House prices have fallen again, the real estate portal Crozilla writes.

The average price per house square metre in August was 1,627 Euros in Zagreb or 1,734 in Zadar, a two per cent drop in both cases compared to July.

A square metre in Pula cost 1,484 Euros last month, a 3.5 per cent decrease from July. In Osijek, the prices fell eight per cent to 772 Euros. Split was one of the rare locations where they grew, in this case by two per cent to 1,688 Euros...

Maruska Vizek from the Faculty of Economics in Zagreb says that the real estate prices in Croatia, including houses, will continue to fall because of the continuous weakening of domestic demand due to the crisis, the rise in interest rates and the drop in unemployment and disposable income.

Looking at other markets, Croatian coastal real estate is comparable to Spain, she says, while the Portuguese coast is on average 20 per cent cheaper than Croatia. "In the end this means that for foreigners, the Croatian coast is not much cheaper so there is no reason to expect a growth in foreign demand," says Vizek.

Another reason real estate market recovery is not to be expected any time soon is because the market is saturated with real estate which is putting additional pressure on prices. The possible sales of state and local government owned property could contribute to further drops, the daily Business writes.