Ljubljana, Slovenia
Few people have even heard of Slovenia - a tiny country located in Central Europe - and with good reason. It was part of the former republic of Yugoslavia and didn't come into being until 1991. With just over two million citizens and a land that is the size of New Jersey, it doesn't make much of a splash in the news or play a pivotal role in global politics. Still, those who have chosen to look past its obscurity give it high marks. Not surprising since Slovenia has everything a European destination should. Gorgeous Mediterranean beaches, snow capped mountains, a backdrop of gently sloping hills and prairies with historic churches and castles to boot, it is all there.
Slovenia has been attracting retirees and nomads, mostly from continental Europe and the United Kingdom, for several years now. "The quality of life is very high, virtually crime free and with great access to nature," said Geraint George, Founder and Director of a UK based company - Slovenia Real Estate. "Over 50 percent of Slovenia's land mass is covered by trees. From its main airport you can be skiing in 10 minutes and then swimming in the Adriatic 50 minutes later." People who are looking to take time of and discover Europe might also be pleased with its central location. Slovenians in general also tend to make an effort to learn and speak English making it easier for travelers to get around.
About Slovenia
Slovenia borders Italy, the Adriatic Sea, Croatia, Hungary and Austria and roughly covers 7,825 square miles. The majority of the nation's two million people speak Slovenian and over half identify themselves as Catholics. Since seceding from the former Yugoslavia, Slovenia has established itself as a stable democracy and is a member of the EU and NATO. The capital city Ljubljana is also the biggest city in the country and is home to some 280,000 residents.
Since breaking away from the former Yugoslavia, Slovenia has both politically and economically done well. Its economic success is not surprising given the fact that, prior to its independence, it produced a fifth of Yugoslavia's GDP and a third of its exports with just one- thirteenth of the population, according to the US State Department. When Slovenia declared its independence in 1991, it already had a good industrial and export infrastructure in place. This undoubtedly gave the country a more economically stable start than most other brand new countries.
Slovenia's current GDP (calculated in purchasing power parity) per capita stands at USD 29,600 according to the CIA World Factbook. The country is part of the Central European Free Trade Agreement and a member of the WTO. Its export focused economy is highly susceptible to outside shocks especially changes in its main trading partners - Germany, Italy, and Croatia.
At 64.3 percent, services contribute the biggest chunk to the nation's output while 33.4 percent is produced by the industrial sector. Agriculture accounts for about 2.2 percent of Slovenia's economic output. Unemployment stands at 6.7 percent while some 12 percent of the population lives under the country's poverty line. To remain competitive, Slovenia needs to attract more foreign direct investment which is currently below regional average. It also needs more flexible labor laws and business friendly taxes.
Real Estate in Slovenia
For those who are looking to buy property in a central European location, Slovenia maybe the answer. Fans of the country list many reasons to love it. Slovenia has "unspoilt nature - in the top 15 cleanest countries in the world, the 2nd most forested country in Europe. Stunning scenery all around the country but especially the Julian Alps," according to Dan Bendall, owner of Think Slovenia - a licensed real estate agency that offers various pertinent services to international property buyers. "It is possible to ski in the morning, eat lunch in the capital and sunbathe on the Adriatic in the afternoon."
The property market in Slovenia wasn't spared by the global economic crisis. The international segment is currently stagnant. Overall, the real estate market is suffering from an overabundance of offers. "There is an over supply of new apartments in many cities where too many have been built," said George. There are currently some good opportunities. "In other areas local buyers and sellers are generally waiting for prices to stabilize before moving forward in the spring." Demand for properties in well-known areas and those located in cheaper but up and coming neighborhoods remains good.
Slovenian property prices have climbed to similar levels as parts of Western Europe in some areas. "Prices in the capital Ljubljana and the coast are not much cheaper than other well established parts of Europe," said George. However, "There are lots of lesser known areas that are beautiful and where pricing is much cheaper." Expect to spend between 1,500 to 3,000 Euros per square meter in cities such as Maribor and Ljubljana, according to Slovenia Real Estate. A decent apartment can cost anywhere from 100,000 to 200,000 Euros. Outside the major cities, "a small two bedroom property with a few hectares of land covered in vines can be bought for as little as 80,000 Euros." Forty percent of the country is wine producing.
The North West Julian Alps region and the Soca River Valley - where the movie Narnia was filmed - are some of the most beautiful areas of the country, according to Think Slovenia. "It is expensive in parts but still much cheaper than comparable alpine regions of France, Italy, Switzerland, and Austria," said Bendall. "The Goriska Brda, Karst and coastal wine growing regions all bordering Italy in the South West of the country also offer fantastic opportunities for holiday homes and investment." Those with small budgets should consider the South and East of Slovenia.
Buying real estate in Slovenia
European Union and U.S. citizens may buy freely in Slovenia. Other international buyers should check the rules. It depends on "individual bilateral agreements," said Bendall. People from Canada, for example, must set up a company before buying property according to Slovenia Real Estate. "This is not very difficult but will have an ongoing cost of around 750 Euros per year in accountancy costs," said George. He also suggests buyers get an experienced agent that knows the country well. "There are lots of lesser known areas which are beautiful and cheaper," he said. "Using local experts [...] is essential in order to seek out [and take advantage of] such opportunities."
Obtaining financing to purchase a home in Slovenia is an issue buyers must also consider. "Slovenia is really only for those who are able to finance their own purchase," said Frances Sargent, the Managing Director of Slovenian Properties Limited - a company registered both in England and Wales. "Before buyers even think of acquiring property, they really need to get to know the area they want to live in," said Sargent. Every one's personal requirements are different. "Buyers need to consider if and how much time they want to spend renovating a picturesque property in the countryside or whether they would rather buy a fitted out apartment and be out enjoying the wonderful scenery and lifestyle." Buyers must also think about how they would take care of the property in their absence if they are not moving to Slovenia full-time. "Buyers should factor in how they would deal with an emergency." One way to deal with this is hiring a property management company.
Looking ahead
While Ljubljana - the capital - can be expensive, it is expected to remain a good investment. "Gradual return to economic growth across the country will stimulate activity and growth in the real estate market generally," said Bendall. "Continued growth in tourism and improvements in infrastructure will continue to make some of Slovenia’s tourist hot-spots of particular interest to investors."
The outlook for the international property sector also looks good. "I see more and more people especially from the UK buying their retirement homes in Slovenia," said George. For most people, it is a quality of life issue, according to Slovenia Real Estate. "It is possible to have a much simpler life in many remote areas of the country."
