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The Slovenian Property Market

 
 

Useful information about buying and selling Slovenia property

At Think Slovenia we work with a broad range of investors in Slovenian property from private purchasers of holiday homes to investors focusing on Slovenia property development or on Slovenia’s tourist and long term rental markets. Our specialism is on Slovenia’s residential and tourist residential-commercial property markets but we have capabilities and partnerships that can help investors unlock all types of Slovenian property. This page aims to give an introduction to Slovenia property for a broad range of potential investors, but our service is tailored to every client’s unique circumstances. Please see our services for an introduction to the Slovenian real estate services we offer or email us to discuss your requirements. Investors / developers click here.

 

QUICK LINKS TO TOPICS ON THIS PAGE:
THE ECONOMIC BACKGROUND >
KEY PROPERTY TRENDS, FACTS & FIGURES >
THE PROPERTY BUYING & SELLING PROCESS >
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Property in Slovenia – the Economic Background

The Slovenian Economy - Key indicators
GDP per capita (LCU) in 2013 €17,549.50
Growth in GDP in 2013 -1.0%
Projected annual GDP growth for 2014 1.6%
Inflation in 2013 1.8%
Exports of goods and services in 2013 €27.00 billion
Imports of goods and services in 2013 €24.82 billion
Unemployment in 2013 10.14%
 
% share of GDP 2009 2011 2013
Agriculture 2.4% 2.8% 2.9%

Construction

7.9% 6.0% 5.7%

Industry

24.3% 24.4% 25.7%
Services 66.8% 66.8% 65.7%
Tourism is the third largest sector of the economy and is predicted by the World Travel & Tourism Council to grow at an estimated 5% per annum 2008-2018, versus 3.5% EU and 4.4% annual global growth.
Major industries: Wood products, textiles, chemicals and electronics.
Main agricultural products: Wheat, sugar beets, cattle and sheep.
Main exports: Machinery, equipment & finished products (chemicals and food).
Trade partners: Over 60% of exports are to the countries of the EU.

Click here for a simple guide in English to Slovenia's tax regime

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 was impressive with the country taking a number of tangible steps to improve the business climate and take 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 millennium meant that the country was the first of the new EU entrants in 2004 to join the Euro in January 2007. Since then the long-term outlook has remained broadly positive though the Slovenian economy has struggled for the past few years with European and global economic crises having a big impact on the local economy. We are now starting to see signs of recovery with revised projections for 2014 and 2015 suggesting the economy will return to growth.

 

One of the bright spots of the Slovenian economy in recent years has been the tourism sector which has continued to grow strongly.

 

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

 

The Slovenian Property Market – key trends, facts and figures

3 features of the Slovenian property market of interest to foreign investors:

A relatively low level of transactions per capita means that the supply of properties on the market is limited in many areas and property can be hard to find

Large differences in pricing can be found between comparable properties – due to the size of the market & relatively low level of transactions per capita
Mortgages can be obtained by foreign investors within Slovenia on the basis of non-Slovenian income, but banks are relatively conservative and need to be strongly convinced of the ability of the buyer to make repayments. 70% typical maximum loan to value and mortgages are usally offered on a repayment basis only

The global downturn has had a significant impact on the Slovenian property market and construction sectors, with a dramatic fall in the number of transactions leading to oversupply on the market and price drops around the country. The early part of 2014 saw a sharp increase in transaction levels - albeit from a very low base. Combined with projections of a sustained return to economic growth in the wider economy, this suggests the start of a recovery in the market and an ideal buying opportunity whilst prices remain low and plentiful choice on the market.  

 

Ljubljana and the leading coastal and mountain resorts remain the most expensive parts of the country to buy in, however 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.

 

 

Developing and Renovating Slovenian Property

Anti speculative tax regulations, availability of credit and tight planning regulations and procedures can make property development in Slovenia a challenging enterprise. On the other hand it also makes it less competitive than some other markets. Prospective developers should also bear in mind that the relatively strong culture of self building in Slovenia means that market does not price the work involved in the development / renovation of Slovenian property as highly as some other markets. We have worked with a wide range of developers and assisted clients with a very broad range of developments in Slovenia. Please click for our dedicated page for renovations, our page for professional developers / investors or alternatively contact us to discuss your individual requirements.

Villa Planina was built and furnished with the help of Think Slovenia.

 

Renting out Slovenia Property

The residential rental market is smaller on a per capita basis than many Western European countries due to the very high levels of home ownership in Slovenia. This said, demographic and other social changes are helping to ensure that the rental market remains buoyant in Ljubljana and the other larger Slovenian towns, with gross yields of around 5% achievable. The tourist rental market is also of interest to many foreign investors with yields of 3-7% possible in and around the main Slovenian tourist resorts and with some of the mountain areas offering genuine year round rental potential. We recommend all potential investors interested in Slovenian property rental for tourism to take advice prior to purchase and to be aware of the relatively complex procedure of setting up for tourist rental. Please click here for more information on lettings & management.

 

This chalet in Bohinj is one of the many properties let / managed by Think Slovenia.

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.
Click here to register for a property alert - and we'll send you details of properties for sale that match your criteria
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.

Generally the property purchase process in Slovenia is relatively quick and straightforward with an efficient and comprehensive Land Registry system. 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.

 

Once you’ve got the keys in hand the real work starts! Please see Buying with Think Slovenia for more details of how we can help you once you have purchased a property – we have a range of services to help you renovate, furnish, let and manage your Slovenian property.

 

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