Photo: PixabayApartment rental prices have never been this high, and additional pressure on the real estate market was caused by the arrival of a large number of Russians and Ukrainians in Serbia, after the start of the war in February. Thus, it is practically impossible for many tenants to afford a roof over their heads.
The price varies, from 230 euros per month for a studio apartment in Voždovac to a luxury apartment in Dedinje of 225 square meters that is rented out for 7,000 euros.
According to the professor of the Faculty of Law in Belgrade, Svetislav Kostić, the bill submitted to the Serbian Parliament by the Initiative "Don't drown Belgrade" foresees a maximum amount of rent that would be determined according to a special formula and that would depend on the average salary, location, energy efficiency and the condition of the property that is issued.
"The highest monthly rent for one square meter should not exceed one percent of the average net salary, so the highest monthly rent should not be higher than 750 dinars per square meter." Thus, the highest rent for an apartment of 55 square meters is about 350 euros. This maximum amount of rent is further multiplied by three coefficients (location, apartment quality and energy efficiency) and their application can further reduce the price. According to that calculation, the highest monthly rent for an apartment of 55 square meters on Zvezdara in Belgrade, in a building built in the nineties of the last century, would amount to around 240 euros," explains Kostić in an interview with Biznis.rs.
THE LIMITATION ALSO EXISTED IN DOMESTIC LEGISLATION
Kostić believes that the limitation of rent prices is the solution for the current situation, but also reminds that this model has been applied throughout the world for more than a century.
"The fact that in our country, unfortunately, the understanding of the free market is at a very low level, does not change the fact that rent control has existed in Europe for 120 years. The Germans introduced this solution then, the Austrians 100 years ago, the Swedes 80 years ago, and many people do not know that rent control was introduced for the first time in our country in 1919 by the government of Stojan Protić. That law was valid until 1930," emphasizes Professor Kostić.
He adds that these are completely common measures that are also present in the United States of America, the Netherlands, the Czech Republic, Poland, Spain...
"The stories that the right to property is encroached too much in this way are not true. For more than 30 years, perhaps a little more, the practice of the European Court of Human Rights has been developed, which precisely interpreted and determined the provisions of Austrian, Polish and some other laws. In each of those judgments, the position was taken that this type of restriction of the use of property rights is permissible," he pointed out.
Svetislav Kostić reminded that the same applies when it comes to loans, because "green" contracts represent a limitation of the right to lend money at the interest someone wants.
"That is prohibited by law, and the same is the case here, so in a situation where residential housing in Serbia has reached an acute phase of the disease and when people are forced out onto the street, such a measure would, in my opinion, be adequate," says Kostić.
LANDLORDS DO NOT SEE THE SOLUTION IN LIMITING PRICES
The president of the Association of Landlords of Serbia, Dragan Cvjetićanin, tells Biznis.rs that apartments are private property and that the state should not interfere in it. Rents, he believes, will probably continue to rise, considering the arrival of Russians and Ukrainians, and then also the price of new construction, furnishing apartments and the like.
"Apartments are private property and it is difficult for the state to do anything about it, because prices are mostly determined by supply and demand." Probably no one expected that this influx of foreigners, mostly Russians, would be so pronounced. If that stabilizes a little, maybe the prices of renting apartments will stabilize and even fall a little," Cvjetićanin assessed.
When it comes to limiting rental prices applied by many European countries, he claims that it is about corporate apartments, unlike ours, which are privately owned.
"You will hardly be able to force a private person to limit the price here, and on the other hand, leave him legally unprotected in many other matters - at the mercy of the tenant whether he will pay the rent, utility bills, ruin your apartment... Limitation of the rental price could be one of the solutions, but I don't know how feasible it is", believes Cvjetićanin.
As he says, everything has become more expensive, so rent prices and real estate prices only follow the cost of living.
"The landlord needs to furnish the apartment, and the craftsmen have also raised their prices." The prices of new apartments have also dragged down the price of old apartments. If you want to have a lower rent, you will move into a worse and less well-equipped apartment," says the president of the Association of Landlords of Serbia.
According to Dragan Cvjetićanin, it is more important than limiting prices to specify the relations between owners and tenants.
"The state should take some steps, so that representatives of landlords and tenants sit down at the table with state representatives and see what concretely could be done." One of the options is for the state to build its own apartments and then rent them out at a social price. Then, the state can refund a certain part of the rent for a group of people who meet certain criteria (families with small children, socially vulnerable...)", believes Cvjetićanin.
REGULATE THE RELATIONS OF LANDLORDS AND TENANTS BY LAW
Professor Kostić states that according to the 2011 census, we had 260,000 apartments for rent, of which 2,000 landlords paid taxes. As he says, the scale of tax evasion is enormous, and on the other hand, the tenants have no interest in the lessor paying the tax, because in the current circumstances he would pass that burden on to them.
"In this bill, rents in Serbia are not recorded because, apart from the state, which has never dealt with these matters much, no one has a greater interest in recording them." Landlords don't want to pay taxes, and they don't. The draft law foresees the mandatory solemnization of the real estate lease agreement with a notary, whereby the lessee is given significant rights if this is not done, that is, a significant risk is placed on the lessor. In the event of a dispute, and there is no solemnized contract, the burden is solely on the landlord," explains Svetislav Kostić.
He added that in that situation, as soon as the risk increases, conditions are created for everyone to become interested in regulating things.
"Why should we have any understanding for landlords who properly, in order not to pay taxes, accept the risk of not having signed contracts?" That's why they were not in a position to sue the tenants for compensation, because they would have exposed themselves to additional risk," stressed Kostić.
Many people in Serbia, our interlocutor notes, own another property in addition to the one they live in, and that property usually serves to supplement the household budget. Those people are not professional landlords, that's why they cannot be classified as big owners of capital and towards them, the professor points out, you also need to be understanding.
"Thus, in addition to the proposal on controlled rent, the Initiative "Ne davimo Beograd" submitted a proposal to amend the Law on Citizens' Income Tax, where for apartments, if you have another one in addition to the one you live in, you would be completely exempt from income tax up to 65 square meters - provided that the rent for that apartment is controlled by law," Kostić assessed.
Source: biznis.rs
