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In recent years, Serbia has seen a stable economic growth rate, which has made it an attractive destination for foreign investors. As a result, not only do many foreign companies establish their branches or affiliates in Serbia, but there is a noticeable increase in the number of foreigners coming to our country to purchase real estate and settle here.
Besides coming to enjoy life in Serbia, there is an additional reason why would one decide to become the owner of an apartment or house in Serbia. Namely, it is possible to obtain a Serbian residence by real estate. For those who do not wish to expand their business activities in Serbia but are instead coming for leisure or exploring this country, a real estate purchase is a great way to ensure a stable legal ground for obtaining a temporary residence permit which legally enables a longer stay in Serbia than the regular tourists.
So far, we have analyzed temporary residence permits for foreigners from different points of view – we wrote about company formation (and obtaining temporary residence in Serbia on that legal ground), applying for work permits, and this time, we are moving our focus to another interesting topic. In this blog, we will cover the essential details and requirements for obtaining a Serbian residence permit by buying real estate. We will discuss topics such as the possibility for a foreigner to purchase real estate in Serbia, as well as the requirements and conditions to apply for temporary residence on that basis.
Generally, yes, Serbia allows foreigners to buy real estate, but certain conditions must be fulfilled.
Firstly, foreigners can only purchase certain types of real estate:
- residential building
- business premises and business building, if conducting business activities in Serbia.
On the other hand, foreigners cannot purchase agricultural land unless in certain specific situations, which require some additional preconditions to be fulfilled. If you are interested in buying agricultural land in Serbia, do not worry – we got you covered on that topic, as well.
Additionally, there are some limitations based on reciprocity agreements. The general rule is that foreigners are permitted to purchase property in Serbia if Serbian residents are permitted to do so in their home country. This principle ensures a level playing field for all investors, and it protects the interests of both Serbian citizens and foreign investors.
For instance, if a citizen of Germany can buy real estate in Serbia, then a Serbian citizen can buy real estate in Germany under the same conditions.
How can you know whether there is reciprocity? There are two ways:
- If Serbia and the concerned nation have reached a bilateral agreement that governs the matter of foreigners buying real estate, the legal reciprocity criterion is satisfied.
- If there is no such agreement, it should be determined whether there is a factual reciprocity between the two states. What does that mean? Although the two countries have not concluded an explicit agreement on this topic, the competent authorities of the two countries can determine that there is factual reciprocity by analyzing the regulations of the foreign country and exchanging official notes between the two involved countries. In our country, information on whether there is reciprocity with a particular country can be obtained by consulting the domestic Ministry of Justice.
In case there is no reciprocity (legal or factual), unfortunately, you as a natural person will not be able to purchase real estate and consequently obtain Serbian residency by owning real estate.
If your primary goal is to invest in the company in Serbia, without obtaining a residence in Serbia, there is, however, a way to “indirectly” buy real estate in Serbia by setting up a Serbian company and purchasing the property through that company. However, it is crucial to understand that in this case, it would not be possible for the company founder to obtain temporary residence on the ground of the ownership over real estate, since the founder would not be the direct owner of the property. In this case, you would own the share in the company and the company would own the real estate.
If after some time you decide to apply for temporary residence in Serbia, you can do that anyhow since you own a share in the Serbian company. The difference is that your legal ground will not be the ownership over real estate, but temporary residence in Serbia based on company formation, which we previously wrote about.
In case you decide to go down this road, it is important to note that setting up a Serbian company requires some legal expertise and knowledge of the local business environment. Therefore, it is essential to work with a qualified legal representative who can help with the registration process and ensure compliance with local laws and regulations.
Let’s go back to assuming that you do fulfill the conditions for purchasing property in Serbia. Ascertaining that you are eligible for purchasing real estate in Serbia is a first move towards buying real estate in Serbia and getting a Serbian residence by real estate. However, there are a few more steps to complete before you are granted a temporary residence permit on these legal grounds.
The next step required for this procedure logically would be the purchase of the real estate. As we mentioned in our previous blogs, the purchase of immovable property in Serbia must formally be conducted before a notary public office. However, after you sign the real estate sale and purchase agreement, you are not yet officially the owner of the real estate. You will be registered as the owner after the change of ownership is submitted to the real estate cadaster, who is the competent authority for this procedure, and after it has issued the decision on that fact. Luckily, you don’t need to wait until that happens – when applying for a temporary residence on this basis, you need to supply the competent authorities with only a notarized purchase contract, and not a real estate cadaster registration decision.
In practice, this means that just signing the agreement on the real estate purchase is usually sufficient for you to apply for temporary residence, although you will not be officially registered as the owner until the cadaster issues their act.
After that, the procedure is quite simple. All you need is to submit an application for a temporary residence permit with all necessary documents to the competent authority which is, in this case, the Department for Foreigners in the relevant Police Station. After submission of the application, it is required to wait for a decision for approximately about one month to officially obtain a temporary residence permit.
Finally, have in mind that one of the legally prescribed requirements for the residence permit to be approved is that a foreigner lives in the purchased real estate. That said, the authorities would probably not look favorably on leasing the purchased property and living in another apartment in Serbia.
Once you obtain your first temporary residence by real estate, can remain calm for a certain time and peacefully live at your home in Serbia. However, there are a few additional requirements that need to be fulfilled for you to ensure you will be able to renew your residence permit once the initial approved period expires.
One of the main requirements concerns the minimum number of days that a foreigner must stay in Serbia when they obtain a temporary residence permit. The minimum stay requirement is one-half of the approved time. Having in mind that usually the temporary residence is approved for one year, that means that foreign investors must spend at least six months (183 days, more precisely) in Serbia every year to maintain their temporary residence permit. However, do not forget that the mandatory ½ time spent rule applies even if you obtain temporary residence for a shorter period than one year. For instance, if you get your permit for 6 months, you will have to spend at least 3 months in Serbia in total or otherwise you may not be able to renew your residence here.
A question often raised regarding this topic is whether there is an official minimum value of real estate purchased in Serbia for obtaining a Serbian residence by real estate. In other words, how much money must be spent for real estate for it to be considered a “strong enough” legal ground for a foreigner to get residence in Serbia?
Unfortunately, there is no certain response to this question given that there is no regulation or official opinion clarifying this matter. With that in mind, it is usually advised to purchase real estate whose value would be recognized as reasonable for decent living by an average person. The price of the property will depend on its location, size, and condition.
Yes, it is possible to buy real estate in Serbia remotely. This is a common practice among foreigners who wish to obtain a temporary residence permit by buying real estate in Serbia. The process of buying real estate before arrival in Serbia is straightforward, and it involves working with an experienced legal representative in Serbia who would be authorized by the buyer located abroad to conduct all the necessary procedures related to the purchase of the real estate. This usually includes:
- Signing the real estate sale and purchase agreement and conducting other activities before the notary public
- Assisting in the transfer of the real estate purchase price, if necessary
- Submitting the necessary documents to the tax authorities to comply with the tax obligations arising out of the purchase of the property.
To sum up, you can buy a property in Serbia without having to leave the country where you are currently located. After you become the homeowner, you can come to live in Serbia and apply for a temporary residence permit at any time.
Before commencing with the purchase procedure, it is necessary to conduct research on the local real estate market and identify the right property matching your needs. After finding suitable real estate, it is essential to perform legal due diligence on the property and check whether there are legal issues that could endanger the purchase. Because of this, wisely use recommended steps while selecting a home and carrying out your due diligence.
Finally, what are the benefits of obtaining a residence permit in Serbia by purchasing real estate? There are numerous advantages to acquiring a temporary residence permit in Serbia, particularly through the acquisition of real estate:
- Business opportunities: Serbia is an attractive destination for business, and foreigners who reside here can take advantage of the country’s growing economy and business opportunities.
- Quality of life: It is often said that Serbia offers a high quality of life at a lower cost than many other European countries. Foreigners frequently decide to settle in Serbia so they can enjoy all that Serbia has to offer, including its rich culture, beautiful landscapes, and friendly people.
- Education: Serbia has a strong educational system, with many excellent universities and schools. Foreigners who obtain a temporary residence permit can take advantage of these opportunities for themselves and their families.
- Real estate investment: Serbia’s real estate market is booming, and buying property can be a profitable investment.