During the past year, in the midst of student blockades and mass protests, due to the fall of the canopy at the railway station in Novi Sad and the death of 16 people, Aleksandar Vučić he offered young people favorable loans for apartments.
Since when is it active? this support program, more than 6.700 young people solved their housing issue in this way, according to the Minister of Finance Siniše Malog.
On Thursday (May 7), the Government of the Republic of Serbia, through an amendment to the law concerning support for the purchase of a first apartment, set aside another 300 million euros, in order to "enable the effective implementation of the measures taken to support young people."
Is this measure really effective?
Populist measure or real help
Young people can get a subsidized loan of 100.000 euros to buy their first apartment.
According to the planned plan, the down payment for such an apartment will amount to 1.000 euros. That is, one percent of the total value of the apartment.
The market value of the down payment for an apartment, without subsidies, is 10 to 20 percent. Which means that young people previously had to allocate between 10 and 20 thousand euros in cash just for this step. For many, it was not feasible, so this government measure seems like a big relief at first.
However, the state undertook to subsidize only the first six years of loan repayment.
The subsidized fixed interest rate during that period is 1,5 percent annually, and after that repayment continues at a variable interest rate consisting of the six-month Euribor and a fixed margin of two percent.
In translation: if we have an apartment worth 100.000 euros, and we took a loan for 35 years, in the first year the loan installment will amount to about 120 euros, from the second to the sixth year 260 euros, and after that about 470 euros.
Danilo Ćurčić, program coordinator of the initiative for economic and social rights A 11, told Vreme that this measure is "obviously an attempt by the government to appease the students".
He points out that there are probably young people who benefited from this measure, but that it is aimed at the wrong group of the population - the wealthier part of society.
"What we have seen so far is that these loans are used by people who could more or less manage on their own in the market. Therefore, this is not some kind of support for those who are at risk," he says.
"It really seems to me that it is very difficult for someone who is, for example, a shoemaker in Paraćin and is 22 years old to manage to take out this loan, or to even dare to enter into something like that," adds Ćurčić.
What can be bought for 100 thousand euros
In Zemun, an apartment of 54 square meters costs about 230.000 euros, while in Mirijevo, an apartment of the same square footage is sold for about 150.000 euros. For better locations, a significantly larger amount of money must be allocated in Belgrade - what is it about "Vreme" also wrote earlier.
Photo: Vreme/Anja MihićIn the municipality of Savski venac, the price per square meter is 4.400 euros
According to the Republic Institute of Statistics, the average price of a new building in Serbia in the first half of 2024 was 215.481 dinars (about 1.800 euros). Apartments in one of the central Belgrade municipalities, Savski venac, reached prices of 520.616 dinars per square meter (about 4.400 euros).
"It's increasingly difficult to buy anything for that 100 euros in big cities. We have a huge increase in housing prices. How many square meters is that in an average municipality in Serbia? In Belgrade, I think it's almost impossible to buy something for that money," says Ćurčić.
There is also the issue of bail. For example, unemployed young people can only apply for a loan with a guarantor, which means that technically their parents take on the debt instead of them. Then the term for repaying the loan is drastically reduced. One of the conditions is repayment of the loan by the age of 70, so in this case it is seen in relation to the guarantor.
An additional problem when using these loans is the verification of documents.
It turns out that notaries have to do this on a voluntary basis. In the media last year, there were stories of young people who could not make an appointment with a notary, because this type of work is simply not a priority for them.
Quasi-politics without strategy
Danilo Ćurčić states that there is no housing strategy in Serbia, and that this measure was passed without it.
Photo: Vreme/Anja MihićThere is no housing strategy in Serbia
"There is no document on the basis of which it would be possible to determine what the priorities are in the country in relation to housing inequality and unaffordable apartments. Then in that situation some kind of quasi-policies are adopted, i.e. solutions that provide benefits only for certain categories of the population, which are often not the most vulnerable - but are taken out as priorities from some other interest," concludes Ćurčić.
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