Serbia’s property market recorded approximately €2.2 billion in transactions during the second quarter, up around 8% year on year, despite a decline in the number of completed deals. The number of transactions fell by more than 5% to roughly 30,500, creating a market in which the total value of completed sales is increasing while transaction activity is contracting. The figures show that fewer properties are changing hands, while the properties that do reach the market are generating higher transaction values.
Residential property remains central to the market
Apartments account for the largest share of real-estate market value, underlining the continuing role of residential property both as housing and as an investment asset. The decline in transaction numbers comes alongside continued mortgage lending, while apartment prices have increased substantially over recent years.
At the same time, construction and land costs remain elevated, affecting the economics of both property development and residential purchases. The combination of higher property prices and fewer transactions indicates that affordability is becoming a greater constraint for potential buyers.
Household affordability faces greater pressure
Cash purchasers and investors are less directly exposed to financing costs than households dependent on mortgage borrowing. For ordinary households, however, the relationship between salary levels and urban property prices has become increasingly difficult as housing costs have risen.
Strong mortgage borrowing has therefore continued alongside a reduction in the number of completed property transactions, indicating that demand remains present even as the number of buyers able to complete purchases becomes more limited.
Developers face longer sales cycles
The shift toward a lower-volume, higher-value market does not necessarily indicate instability in the property sector. A reduction in transaction numbers can accompany a consolidation following several years of strong demand, particularly where forced sales remain limited and employment remains strong.
For developers, however, higher prices do not eliminate the challenge of finding buyers. Projects can remain profitable at higher unit prices, while the period required to sell completed units may increase if fewer purchasers meet affordability and financing requirements.
Market moves toward a different balance
Serbia’s property market is therefore experiencing higher transaction values alongside lower sales volumes rather than a broad collapse in activity. The combination of approximately €2.2 billion in Q2 transaction value and around 30,500 transactions points to an increasingly expensive market in which buyers are completing fewer purchases.
The development of the market will also depend on the relationship between new housing supply, land availability and infrastructure constraints. Where construction remains concentrated in areas facing restrictions on land and infrastructure, property prices may continue to face upward pressure even as transaction volumes remain lower.
