Buying property in Serbia as a foreigner

Can a foreigner buy property in Serbia?

Serbian law allows a foreign individual to acquire real estate if Serbian citizens can acquire property in that person's country. This is the reciprocity principle. For citizens of most EU countries, the United Kingdom and the United States, reciprocity exists for apartments and houses. For other countries it is checked in each case.

Agricultural land is subject to separate, stricter rules, and in most cases a foreign individual cannot buy it. If a plot includes farmland, check its status before you negotiate.

A foreign company can also acquire property, and a Serbian DOO owned by foreigners buys property as a Serbian legal entity.

Check the title before the deposit

The cadastre extract (list nepokretnosti) shows the registered owner, the ownership shares, mortgages and other encumbrances, and notes on disputes. Check that the seller in the contract is the person registered as owner, and that the unit in the extract matches the one you saw, including floor, number and area.

Property acquired during marriage is usually joint property of both spouses, even if only one of them is registered. In that case the spouse's consent is needed. Co-owners may have a pre-emption right, which must be respected before a share is sold to a third party.

• Registered owner and ownership shares
• Mortgages, liens and enforcement notes
• Notes on court disputes
• Building permit and use permit
• Whether a spouse or co-owner must consent
• Unpaid utility bills, maintenance and property tax

Deposit and pre-contract

Buyers often pay a deposit (kapara) when they agree on the price. Under the Law of Obligations, if the buyer backs out, the deposit is usually lost. If the seller backs out, the buyer can ask for double the deposit.

A pre-contract for real estate must have the form required for the main contract, which means it must also be made before a notary. Do not pay a deposit on the basis of a handwritten note or a message. Pay only after the title check, under a contract that states what happens if the deal fails.

Signing before a notary and registration

A contract for the sale of real estate in Serbia is made as a notarial deed by a public notary (solemnization). Without it, the contract is not valid. If you do not speak Serbian, a court interpreter must be present, and the contract can be prepared in two languages.

Payment should go through a bank account, never in cash. Instalments are often tied to events, such as the release of the seller's mortgage or the handover of the keys. After signing, the notary sends the contract to the cadastre, and you become the owner when the cadastre registers you.

• Title check and agreement on the main terms
• Pre-contract before a notary, if a deposit is paid
• Final contract solemnized by the notary
• Payment of the price through a bank account
• Registration of ownership in the cadastre
• Tax filings and handover of the property

Taxes and costs

On resale property, the tax on transfer of absolute rights is 2.5% of the price. The tax authority may assess a higher base if the agreed price is below market value. By law it is the seller's tax, but the parties often agree in the contract that the buyer pays it. A new build bought from a developer is subject to VAT instead, which is usually included in the price.

Other costs include the notary fee, the court interpreter and cadastre fees. As owner, you then pay annual property tax to the local municipality. A foreign buyer needs a Serbian tax identification number for the tax filings.

Common mistakes and when to involve a lawyer

A lawyer is useful from the first offer. Our office reviews the title and encumbrances, drafts the contract in English and Serbian, represents you before the notary and handles the registration of your ownership. If you cannot travel, we can act under a power of attorney certified at a Serbian consulate or by a notary in your country with an apostille.

• Paying a deposit before checking the title
• Relying on an agent's summary instead of the cadastre extract
• Buying a property without a use permit or with an unregistered extension
• Paying in cash, which is hard to prove later
• Overlooking the consent of the seller's spouse
• Signing a contract you cannot read

Frequently asked questions