Expat Guide: Investing in Serbian Real Estate

Published on October 4, 2025 and written by Cyril Jarnias

Serbia, located in the heart of the Balkans, is attracting more and more foreign investors thanks to its dynamic real estate market and attractive prices. For expatriates looking to diversify their assets or prepare for retirement, real estate investment in Serbia offers numerous opportunities. This detailed guide will help you understand the challenges and key steps to successfully complete your property purchase project in this growing country.

The Serbian Real Estate Market: Attractive Potential for Expatriates

The Serbian real estate market has been experiencing significant growth for several years, driven by sustained economic growth and increasing interest from foreign investors. Belgrade, the capital, as well as cities like Novi Sad or Niš offer interesting prospects in terms of rental yield and medium-term capital gains.

Property prices remain competitive compared to other European countries, with apartments in central Belgrade trading between 2,000 and 3,500 euros per square meter. Secondary cities offer even more affordable rates, often below 1,500 euros per square meter.

The rental market is also dynamic, particularly due to growing demand from students, young professionals, and expatriates. Gross rental yields can reach 5 to 7% in the most sought-after areas of Belgrade.

Legal Framework for Foreign Property Purchase in Serbia

Serbian legislation allows foreigners to purchase real estate, but certain conditions must be met:

• The principle of reciprocity: Serbian citizens must be able to purchase real estate in the foreign buyer’s country of origin.
• Foreigners can acquire apartments, houses, and commercial buildings without particular restrictions.
• The purchase of agricultural land is subject to stricter conditions and generally requires the establishment of a local company.

It is highly recommended to hire a lawyer specialized in Serbian real estate law to ensure the transaction’s compliance and avoid any future disputes.

Property Purchase Procedure for Expatriates

The property purchase procedure in Serbia includes several important steps:

1. Property search and price negotiation 2. Verification of the property’s legal status (title deed, possible mortgages) 3. Signing a preliminary contract (predugovor) before a notary 4. Obtaining authorization from the Ministry of Justice (if necessary) 5. Signing the final sales contract (kupoprodajni ugovor) before a notary 6. Registration of the property transfer in the cadastre

The average time to finalize a real estate transaction in Serbia is about 2 to 3 months.

Property Purchase Financing for Expatriates

Financing a property purchase in Serbia can be complex for non-resident expatriates. Serbian banks rarely offer mortgage loans to foreigners without local income. Therefore, it is often necessary to turn to alternative financing solutions:

• International mortgage loan from a bank specialized in your country of origin or residence
• Refinancing of an existing property in your home country
• Use of personal or family savings
• Establishment of a Serbian company to facilitate obtaining a local loan (a complex solution to be studied with an expert)

Interest rates for mortgage loans in Serbia are generally higher than in the eurozone, with variable rates around 4 to 6% in 2024. The maximum loan term is often limited to 20-25 years.

Costs and Taxes Related to Property Purchase

When purchasing property in Serbia, several fees and taxes should be anticipated:

• Property transfer tax: 2.5% of the property value (for used properties)
• VAT: 10% for new properties (may be recoverable under certain conditions)
• Notary fees: approximately 1% of the property value
• Real estate agency fees: typically 2 to 3% of the sale price
• Cadastre registration fees: approximately 100 euros

The total cost of additional fees can represent about 5 to 7% of the purchase price.

Real Estate Taxation for Expatriate Investors in Serbia

Real estate taxation in Serbia is relatively advantageous for foreign investors, but it is crucial to understand the tax implications in your country of residence.

Local Taxation in Serbia

• Annual property tax: between 0.4% and 2% of the cadastral value of the property
• Tax on rental income: 20% of net income (after a standard 25% deduction for expenses)
• Property capital gains tax: 15% of the realized gain (possible exemption after 10 years of ownership)

Serbia has signed tax treaties with many countries to avoid double taxation. It is essential to verify the specific provisions applicable to your situation.

Tax Implications in the Country of Residence

As an expatriate, you will also need to consider the taxation in your country of residence:

• Declaration of foreign rental income
• Possible taxation of property capital gains
• Reporting obligations related to owning property abroad

It is highly recommended to consult an international tax expert to optimize your overall tax situation.

Rental Management and Investment Return

To maximize the return on your real estate investment in Serbia, effective rental management is essential. Several options are available to you:

• Direct management: ideal if you reside in Serbia or have good knowledge of the local market
• Rental management agency: recommended solution for remote investors, with management fees (typically 8 to 12% of rents)
• Seasonal rental via online platforms: high return potential but more intensive management

Gross rental yield in Serbia can reach 5 to 7% in the most attractive areas of Belgrade, and up to 8-10% in some secondary cities.

Investment Strategies for Expatriates

Depending on your profile and objectives, different investment strategies can be considered:

• Purchase of a new property to benefit from market growth and minimize renovation work
• Investment in an older property to renovate and maximize potential capital gains
• Acquisition of a property for short-term rental in tourist areas
• Investment in commercial real estate to diversify your portfolio

It is crucial to adapt your strategy to your personal situation, investment horizon, and risk tolerance.

Conclusion: Keys to a Successful Real Estate Investment in Serbia

Investing in Serbian real estate as an expatriate can be an excellent opportunity for asset diversification and generating complementary income. However, the success of such a project requires meticulous preparation and a good understanding of local specificities.

Key points to remember for a successful investment:

• Conduct thorough market research and target areas with high potential
• Surround yourself with competent local professionals (lawyer, real estate agent, accountant)
• Fully understand the legal and tax framework applicable to foreign investors
• Develop a financing strategy adapted to your expatriate situation
• Anticipate aspects of rental management and property maintenance
• Stay informed about developments in the real estate market and Serbian regulations

By following these recommendations and adopting a cautious and thoughtful approach, you will maximize your chances of making a profitable real estate investment in Serbia.