In today's time of the COVID-19 virus pandemic, the real estate market has experienced stagnation and a slight drop in prices. Real estate prices change depending on various aspects, and through this text we will guide you to things that affect the price of real estate and the real estate market itself.
COVID-19 and the real estate market
The corona virus pandemic has caused major problems for the real estate market in Croatia. During the first wave of the virus, the real estate market was in complete stagnation, while now the situation has almost returned to normal.
Since the work of real estate agencies mostly takes place in the field, the current situation is favorable, and with the re-introduction of the quarantine, we probably won't have the same scenario as in the spring, because many real estate agencies have turned to a modern sales approach.
“Thanks” to an invisible enemy, real estate agencies (like many other businesses) were forced to digitize. Today, there is almost no agency that does not regularly edit its website with the publication of new ads, and does not use social networks as a sales tool. All this makes it easier for potential buyers to quickly review the offer and properties, regardless of whether they followed you on a social network or found you through a Google search.
What affects the price of real estate?
There are two things that have an impact on the price of real estate, namely the state of the real estate market and the characteristics of the real estate itself. The state of the real estate market is a variable factor, which you cannot influence, but you can influence some other things, such as the arrangement of the property.
The main thing that affects the price of real estate is its location. Properties in excellent locations, such as the city center or first row to the sea, achieve a significantly higher price when selling, than those in less attractive locations. In addition, the area of the property and the garden play a big role in determining the price. These three pricing factors are immutable and beyond your control.
On the other hand, there are a few things about pricing that you can influence, which are:
- Speed of selling the property – If you intend to sell the property quickly, the selling price will be slightly lower than the real one, in order to find buyers as quickly as possible.
- Condition of the property – A property that requires adaptation or renovation will fetch a significantly lower price than properties that are in good condition. If you are not in a hurry to sell, renovating the property can help you find buyers faster and achieve a higher price for the property.
- Real estate renovation – Real estate with old and worn-out furniture is not pleasing to the eye and most owners immediately factor in the price needed for new furniture. Furnishing a property before selling it can raise the price of the property and affect the speed of the sale.
In order to sell the property as quickly as possible and achieve the best possible price, you can carry out small repairs on the property yourself and arrange it before advertising and viewing potential buyers. We have already written about these topics on our website, and you can read them on the links:
- What affects the price of real estate? – http://pantovcak-nekretnine.hr/sto-utjece-na-cijenu-nekretnine/
- Preparing the property for sale – http://pantovcak-nekretnine.hr/priprema-nekretnine-za-prodaju/
- Furnishing and arranging the property before sale? – http://pantovcak-nekretnine.hr/opremanje-i-uredenje-nekretnine-prije-prodaje/
What affects the real estate market?
A variable factor in real estate prices, which you cannot influence, is the current state of the real estate market. We are currently witnessing an increase in real estate prices in the suburbs, while apartments in the center are being sold at a lower price. COVID-19 is unplanned and only one of the reasons why real estate prices around the world have fallen, but apart from it there are a number of other aspects that affect real estate prices.
Currently, prices in Croatia are affected by 4 main aspects, namely:
- It is more difficult to obtain housing loans, due to the current economic situation in the world
- APN's loans for subsidizing the purchase of real estate
- COVID-19 pandemic
- Tourist season below realistic expectations
Due to the current situation, banks grant loans only to certain people and most often exclusively to their clients. In practice, APN's loans have caused an increase in real estate prices on the market, but currently, due to other aspects that affect prices, they do not even manage to maintain the real estate price, but rather it is falling.
The corona virus had a direct impact on the real estate market in the spring, because real estate agencies were closed and no one went to look at properties. Currently, it does not affect the work of agencies and sales too much, but due to the lower income from the tourist season and the problems it causes in the economic sense, it is one of the main reasons for the drop in real estate prices.
It is currently difficult to predict how the situation on the market will develop, but throughout history, various things have caused prices to fall on the market and rise again over the years.
