Do New-Build Apartment Prices Come Down in Croatia?

Whenever apartment prices come up, new builds are at the centre of the conversation. The Nekretninski puls analysis of 14 October discusses a larger supply of new apartments as a way to calm prices. In this article we look at what developers are actually doing with prices while a new-build apartment sits in the listings.

Kvadratko records every change of asking price in a listing. Since the beginning of July we have tracked 7,186 listings for new-build apartments for sale and 4,833 listings for apartments in older buildings. First we count every listing on its own, then we group new-build apartments by building.

What buyers should know about price cuts

1. A price cut is the exception. In the first two months, roughly five in a hundred new-build apartments get cheaper, and one gets more expensive.
2. When the price does drop, the amount can be noticeable. Among new-build apartments that were cut over the whole tracking period, the typical cut was around €22,000.
3. It is worth checking the other apartments in the building too. Sellers often cut the prices of several apartments on the same day.

The analysis is based on asking prices from listings, so any discount agreed with a buyer is not visible in these data.

New builds get cheaper half as often

We started tracking listings at different times, so some have a longer price history than others. For a fair comparison of new and older apartments we therefore selected listings we can follow for their first 60 days after publication.

Out of every hundred new-build apartments, roughly five got cheaper in those two months. Among apartments in older buildings, roughly ten did. New builds, in other words, get cheaper half as often.

How big the cuts are

Among apartments whose price was cut, the typical cut was 6.5% for new builds and 5.8% for apartments in older buildings. In money, that is around €22,000 for new builds and around €15,000 for older apartments.

New-build prices also go up

Over the whole tracking period, cuts were more common than increases for new builds too, but not by much. Of ten new-build apartments whose final price differed from the starting price, six ended lower and four ended higher. For older apartments, eight of ten such cases were cuts and two were increases. The increases were as large as the cuts, around 6%.

The price of a new-build apartment in a listing is therefore not a one-way street downwards.

Several apartments get cheaper on the same day

On Kvadratko, all listings for the same property are shown as one offer. In this analysis we count the same apartment from the same agency once, and we look at all apartments of the same project together, as one building. That way a large building with thirty apartments does not outweigh a small one with three. We ended up with 502 buildings.

We then looked at how many buildings had at least one price cut or increase. Each building counts once, regardless of how many apartments it has listed. In one building in thirteen, at least one apartment got cheaper. In just as many buildings, at least one apartment got more expensive.

Among buildings with a cut, more than half cut the price of several apartments, almost always on the same day. In one building, the prices of all eight tracked apartments were cut three times within a month. The total cut was 20%. The same goes for increases, which also come for several apartments at once.

With older apartments, every owner decides on the price alone. In a new build, the same seller often sets the prices for several apartments in the project, so the price list changes all at once. The typical cut per building is 6%, around €20,000 per apartment.

When the first cut comes

Among apartments that got cheaper in their first 60 days on the market, the first cut on a new-build apartment typically came after 32 days. For older apartments, after 23 days.

Looking at all apartments we have tracked from the day of publication, regardless of when they got cheaper, the time to the first cut was almost the same, about three weeks for both groups.

Price history on every listing

The price history on every Kvadratko listing shows whether the seller has already changed the asking price. Save a listing to your favourites to receive notifications about price cuts.

How we counted

1. Source. Listings for apartments for sale on Kvadratko with at least one recorded price in the tracking period. We track asking prices from listings, not final sale prices.
2. Price change. For each listing we compare the first and the last recorded price. Tiny edits of a few euros, obvious input errors and attempts at manipulation are recognised by the system and not counted as changes.
3. Listings removed from the site. An apartment that was sold or withdrawn in the meantime stays in the sample if it has at least one recorded price in the tracking period, even if the price never changed.
4. Comparison of new and older apartments. It includes listings published over the summer that we have tracked from the day of publication and that were published at least 60 days ago. We look at what happened to the price in those first 60 days. The listing did not have to stay on the market the whole time.
5. Duplicate listings. The same apartment listed several times by the same agency is counted once.
6. Building. Listings from the same agency or developer that our system links into the same project, in the same settlement, at least three apartments, mostly new builds. Our new-build overview uses the same grouping.
7. First cut. Calculated only for listings tracked from the day of publication, up to the first price below the starting price.
8. Typical means the median: half of the cuts are smaller than that figure, half are larger. Percentages and euro amounts are calculated on the same listings. Current figures for all property types are on the price cuts page.