Tight credit and dwindling savings have kept the property markets in Serbia, Croatia and Montenegro in a slump, according to a report in the Southeast European Times.

It reports that in Serbia, buying an apartment is still not possible for most locals, most of whom earn an average monthly salary of €400 and are unable to find a bank willing to loan a mortgage.

‘It is because of the obscene price per square meter’, the Association of Serbian Banks general secretary Veroljub Dugalic reportedly said.

Per square meter, the average cost of an apartment in Belgrade is reported to be €2,000 so a 70sqm apartment currently costs more than 25 times the local annual salary!

Comparisons show that in Zagreb (Croatia), the average salary requires a potential homeowner to work ten years to buy an apartment of 60sqm, while in Serbia, that same person would take 20 years.

Apartment sales are down in Croatia also but for a different reason, massive oversupply. Nearly 50,000 dwellings have been built but there are currently no customers and prices have fallen by more than 15%. They are expected to fall further over the next five years and at the moment, the price per square meter in Zagreb has dropped from €2,050 to €1,750.

In Montenegro, apartment sales are virtually flat. Prices are down by up to 30%, compared to the ‘golden’ year of 2007, when a wave of Russian buyers swooped in. Five years later, there are no more foreign buyers, and for locals, the prices are too high.

The number of new apartments sold is down by more than 60%. Buyers simply don’t have the money, even for an average price of €1,200sqm.