7,500 unsold new homes at the market
25 September 2008
There are around 30 per cent of the newly built homes on the market still vacant and investors have been unable to sell them for months. President of the real estate agents association in the Croatian Chamber of Economy Dubravko Ranilovic says the key reason of lower sales is in the fact that many investors or owners of apartments have not yet realized they have to lower the prices.
In general, prices of apartments are by 10-15 per cent above their realistic prices, Ranilovic claims. He adds that a part of the problem lies in land owners, who blackmail investors with huge prices. Professor Josip Tica from the Faculty of Economics and Business in Zagreb agrees and says investors were naive buying land at unrealistic prices, counting on a 10-per cent yearly growth of prices. After this failed to happen, they don’t have too much leeway for cutting home prices, Tica explains.