Property in Slovenia – the Economic Background

With its strategic geographical position, proximity and interdependence with Austria and Italy, Slovenia was historically the most prosperous member state of the former Yugoslavia and indeed of all the European communist states.

Slovenia gained its independence from Yugoslavia in 1991 and made rapid progress to transform itself into a modern European market economy with well developed infrastructure and a well educated work force.

Slovenia’s economic performance since EU accession in 2004 has remained impressive and the county has taken tangible steps to improve the business climate and taken advantage of its strategic location to gain significant levels of foreign investment although lower levels than some of its neighbours.

Slovenia’s strong economic performance in the early years of the milennium meant that the country was the first of the new EU entrants in 2004 to join the Euro in January 2007. Since then the outlook has remained broadly positive and Slovenia has weathered the global downturn better than many of its bigger European neighbours.

More general information on Slovenia its economy and regions can be found here.

The Slovenian Property Market – key trends, facts and figures

Prior to the global downturn the Slovenia Property market saw a period of sustained, steady growth with various sources suggesting an average increase in residential real estate of around 10% per year between 2003 – 2007, with certain hotspots seeing higher levels of growth.

The global downturn has had an impact in Slovenia although to a lesser extent than many other more credit burdened central and Eastern European countries. The number of real estate transactions in the Slovenian market has dropped significantly since 2007-8 and this has lead to a halt to price growth and modest drop in prices across the market. In certain locations where the slowdown has coincided with localised oversupply price falls have been more significant.

Ljubljana and the leading coastal and mountain resorts remain the most expensive parts of the country to buy in but in the last few years there has been some flattening of the price differencials between the cheapest and most expensive areas. This said there is still a wide variation in prices charged for similar properties and there are bargains to be found - especially for rural mountain properties - which is why we always recommend our clients let us undertake a bespoke search against their criteria so they understand the extent of what is on the market that suits their needs.

Slovenian Property - The Buying and Selling Process

Using a licensed agency As fully licensed and insured real estate agents Think Slovenia are able to assist with every element of the sales process. We offer these services for buyers, sellers or both parties on a mutual basis. We can offer advice on individual issues on a consultancy basis through to conducting the whole sales process. We also offer a number of useful services especially designed for foreign buyers – such as arranging architectural surveys, putting you in touch with English speaking lawyers, obtaining insurance quotes etc…Please click here for more information on our range of real estate services for buyers.

Finding the right property To get automatic updates on properties which fit your criteria fill in a property alert or contact us for a free impartial assessment on your criteria. For many of our clients coming on viewing trips we not only show them properties on our site but also conduct a bespoke search of the market. This is particularly valuable for people looking in faster moving / low-availability locations. We can also search for land plots for those looking to build or develop their own property.

Insuring your Slovenia property We recommend that buyers put in place buildings and contents insurance as soon as possible and Think Slovenia can put you in touch with Slovenian insurers with policies in English. If you are letting the property, you need to check carefully you are covered in respect of your liability to tenants.

Since joining the EU, the process of buying property in Slovenia has been much simplified and, in general, is less complicated and often faster than buying in the UK and many other European countries.

As in most countries, the price of property in Slovenia is negotiable and the first stage in the purchase process is for parties to agree the price and other main conditions of the sale.

It is not common in Slovenia to formally survey properties after making an offer. It is possible to arrange, however, should you want that peace of mind, but care should be taken if your offer is to be dependent on the findings of the survey and it is often better to survey before making a formal offer.

In most cases once a price is agreed a preliminary contract is drafted which outlines the core terms of the sale and obliges each party to sign a main sales contract within a given time frame. Usually the signature of the preliminary contract is followed by payment of a deposit of 10% of the purchase price.

The deposit has a special status under Slovenian law meaning that the buyer will lose it if he is responsible for the sale not completing and the seller is obliged to return the deposit and pay the buyer the same amount again if he is responsible for non-completion.

Before a main sales contract can be signed key paperwork needs to be obtained including a certificate about the intended usage of the real estate in question and for foreign buyers, Slovenian registration and tax identification numbers. In the event of the real estate having special status of some sort (e.g. agricultural land / located in a National Park / protected status) various documents must usually be obtained before signing main sales contracts.

Land Registry searches to check the ownership status of the real estate should be conducted before signing the preliminary contract and again before signature of the main sales contract. Contracts should be carefully checked by a specialist and translated if appropriate, although unless the translation is court certified it will be the Slovenian version of the contract that must be signed.

Once the main sales contract is signed tax is paid on the transaction (2% sales tax for old properties, VAT payable on new properties / some land types). Common practice is that the sellers pay the tax on the sale. Once the tax has been paid the contract can be taken to a notary where the seller’s signature is certified. Once notary certification is complete payment of the purchase price can take place.

Buyers should be careful to ensure that before payment the certified version of the main sales contract is held securely by a third party and / or they are in possession of a copy of the certified contract. After payment they or their representative will need a copy of the certified contract in order to make a Land Registry inscription of the ownership and possession rights as laid out in the sales contract. It is important to make sure that this happens as soon as possible after the contract is certified and payment made.

Typically, agents charge 4% + DDV (VAT at 20%) split equally between the buyer and seller. On top of the agents fees sellers usually cover costs of the taxes and certification of the sales contract by a notary. Buyers usually pay for Land Registry inscription and translation of documents where appropriate. The final stage of the process is to arrange the hand over. Usually for Slovenia property this takes the form of a face to face meeting at the property where keys are handed over, meter readings are taken and a handover record signed giving the buyer total responsibility for real estate. A simple and secure way for foreign buyers to go through the final stages of the purchase process is to arrange to come to Slovenia for signing of the main sales contract, tax payment, certification, payment and handover, which can in some cases all take place in as little as one day.