How can a foreigner buy an apartment in Serbia? Is it possible to take out a mortgage for this purpose? How much does the average cost of housing in the country, and what additional costs should I expect when buying? A step—by-step guide is in our material.
In Serbia, the “principle of reciprocity” applies when buying real estate by foreigners. That is, Serbia allows citizens of those countries that grant the same right to Serbs to buy housing on its territory. Among such states, for example, Russia, Israel, the USA, Canada and others.
As for the types of purchased objects, there are no restrictions in this regard. The exception is agricultural land and protected areas, as well as real estate located on these sites.
What does buying a property in Serbia give you?
Owners of any type of real estate have the opportunity to obtain a residence permit in Serbia. This requires living in the country for at least 183 days a year. The purchase price does not matter.
A residence permit is issued for one year with the possibility of extension. After five years of residence, you can apply for citizenship with this document. The next of kin (spouse and children) with the wording “for family reunification” can also apply for an annual visa.
Buying real estate in Serbia step by step
Here are the steps you need to take to purchase a home in Serbia:
1. Reserve the desired object.
First, you need to reserve the selected object for a period of time agreed with the seller. It usually takes from one week to one month. At the same time, it is necessary to make a deposit, which usually remains with a real estate agency or a lawyer. The average deposit amount ranges from €1,000 to €5,000 — the exact amount is determined during negotiations. In practice, this step is often omitted.
2. Sign a preliminary agreement.
Then you can sign a preliminary purchase agreement with a notary. This document specifies the description of the object, the price, the amount of the initial payment or deposit (usually 10% of the total value of the property), as well as the time frame in which the main contract will be signed. The preliminary agreement has the same legal force as the main one.
3. Conclude the main purchase and sale agreement.
The content of the main contract is formed by a lawyer, and certified by a notary in the presence of the buyer, seller, real estate agents, a licensed court interpreter and two witnesses. The text of the agreement is drawn up in Serbian.
The buyer will need the following documents:
- passport;
- certificate of marital status;
- the number of the bank account in Serbia from which the funds will be transferred;
- documentary evidence of the origin of the funds.
4. Pay for the transaction.
The amount of up to €10,000 can be paid in cash, and everything above that can be transferred through a bank.
Foreigners without a residence permit can open a special account for non-residents. To pay for real estate in Serbia with it, you must first submit an application to the bank.
Buyers can transfer money from this account or an account in a third country directly to the seller’s or developer’s account. However, it is worth remembering the need to pass currency control.
Immediately after payment at the bank, the buyer, seller, agents, translator and witnesses return to the notary to sign the Clausula intabulandi — the seller’s consent to register the buyer as the new owner of the property in the cadastre.
5. Check the property.
When buying a second home, the seller and the buyer, in the presence of an agent, conclude an Acceptance Certificate. It indicates the identified shortcomings (if any), and determines the time period for their elimination.
In the case of the purchase of a new building, Gradjevinska Permissive is responsible for the quality of the property — a construction permit, and after completion of all work on the site and technical acceptance, a “Permissive use” is issued, that is, a settlement permit.
6. Register the ownership right.
The certificate of ownership (nepokretnost List or Vlasnički list) can be obtained from the real estate cadastre 30 days after completing all the listed steps. The document can also be downloaded and printed from the Real Estate Cadastre website.
Note.You can also buy houses and apartments in Serbia remotely using a notarized power of attorney (it must be translated into Serbian by a licensed translator).
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Related expenses when buying real estate
When buying a house in Serbia, you need to count on additional expenses in the amount of 2.5% to 12% of the transaction value, plus another €350—€550.
- VAT for new buildings is 10% of the transaction value.
- The tax on the transfer of ownership for secondary housing is 2.5% of the transaction amount.
- The registration fee is €50.
- The notary fee is €300—€500 (depends on the transaction).
- The agency commission is 2% (this is the percentage that the buyer pays).
Average house prices in Serbia
Buy an apartment of 90 sq.m. in Serbia, it is possible in the range of €150,000–€235,000.
The price for renting a studio apartment in Serbia is approximately €300-500 per month. You can rent a two-bedroom apartment in the country for €600-850.
Utility bills in Serbia average €140 per month (plus €23 for Internet).
Buying a home with a mortgage
Citizens of this country, as well as foreigners with a residence permit or work permit in the Republic of Serbia, can take out a mortgage loan in Serbia. Serbian banks issue mortgages for a maximum period of up to 40 years.
The interest rate on a 20-year fixed-rate mortgage in Serbia is 6.87%.
Serbia’s country risk
To determine Serbia’s country risk premium, which characterizes the relative investment attractiveness, government-issued securities were considered. There are only a few of them and they are all denominated in US dollars.
Since we are interested in real estate, a long-term government bond with a maturity date of September 2033 and a coupon payment of 6.5% was chosen as the basis. As a risk-free rate, data on the yield of 10-year US Treasury bonds were used in the calculation.
The results of the calculation of the CRP for Serbia for the period from May to December last year are shown in the graph below. The country risk is consistently low and tends to decrease. As of December 29, 2023, CRP = 4.31%.
Frequently Asked Questions
Can foreigners buy real estate in Serbia?
Yes, foreigners from countries that grant the same right to citizens of Serbia can purchase any type of real estate in Serbia, with the exception of agricultural land.
What documents do foreigners need to purchase real estate in Serbia?
Passport, certificate of marital status, bank account details in Serbia, documents on the origin of funds.
What taxes and fees are provided for when buying real estate in Serbia?
VAT 10% for new buildings, transfer of ownership tax 2.5% for secondary, registration fee €50, notary fee €300-500, agency commission 2%.
Is it possible for a foreigner to take out a mortgage for the purchase of real estate in Serbia?
Yes, if you have a residence permit or a work permit. The maximum mortgage term is 40 years, the rate fixed for 20 years is 6.87%.
What is the procedure for buying real estate in Serbia for foreigners?
Reservation of an object, conclusion of a preliminary and basic contract with a notary, payment, registration of ownership.
Author
Yulia Yanukovych Editor-in-Chief
I am responsible for the work of the editorial office. I write expert interviews and guides.
Co-author
Nikolay Yuryevich Trifonov Chief Advisor
Full member of the International Academy of Engineering, foreign member of the Russian Academy of Engineering, Honorary Appraiser of the Republic of Kazakhstan, Senior member (Fellow) Of the Royal Institute of Privileged Real Estate Specialists (Great Britain), Associate Professor, Candidate of Physical and Mathematical Sciences, honorary member of the Society of Kyrgyz Appraisers, the Portuguese Association of Appraisers of Fixed Assets, the Eastern European Union of Experts (Germany), author of the books “Theory of valuation” and “Complex valuation of real estate”. In 1994, he created the Belarusian Guild of Real Estate Specialists, which united the largest private and public participants in the real estate market and privatization in Belarus. In 1994, 1995 and 1996 he held international real estate fairs in the CIS countries. He was one of the organizers of the Western Real Estate Exchange. In 1996, Nikolai created and headed the public association “Belarusian Society of Appraisers” (BOO). From 1998 to 2005, he was elected a member of the Board of the European Real Estate Society (ERES), Director with extended powers – responsible for Central and Eastern Europe. In 2003, he was elected Director General of the Council of Associations of Appraisers of the CIS (since 2011 – the Council of Associations of Appraisers of Eurasia). From 1994 to the present, he has been an expert in various working and expert groups of the United Nations Economic Commission for Europe (since 2014 – in the Group of Advisers on the Real Estate Market). From 2010 to the present, he has been a representative of the BOE in the Council for International Standards of Assessment (IVSC).
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