Housing construction in Serbia as a part of real estate industry has the greatest percentage ratio in the overall real estate industry. This field is featured by various rules and concepts. Interestingly, they are, one might say, invariable so that the input and acceptance of more modern concepts, new housing conditions, acceptance of better living conditions in apartments, belong to science fiction if they happen at the market of Serbia!
Therefore, observing positive experiences from this field is rather intriguing. These experiences can suggest how management of the housing funds in the cities and towns across Serbia are becoming a new-old winning formula. Particularly with a little different logic and method of doing business in regard to complete apartment house running.
fast, if we are ready for that, our habitats may evolve into state-of-the-art
apartment areas offering better living conditions which our cities can
only boast of and stand side by side with all cities of the world.
At the Austrian real estate market exists in many aspects specific model of housing space rent. Renting out of apartments in apartment houses known as ’Zinshous’ is most frequently used in the capital of Austria. The greatest and most beautiful apartment houses constructed from the time of Maria Theresia’s rule until the end of the Second World War are located there. German word ’zins’ originates exactly from that period and means ’rent’.
What is characteristic
of this type of housing space rent is, firstly, the legislation governing
renting of such type of apartments. The unique law regulates renting
of apartments in apartment houses built until 1945, whereas newly constructed
apartment houses whose housing units are also intended exclusively for
renting out are subject to somewhat different legislation.
Owners of the ’Zinshaus’ type of buildings are mainly rich old Vienese families, wealthy people and businesses, though in a fewer number. An average monthly rental fee is rather convenient for European standards and amounts to about 4 €/m². It certainly depends on location, equipment of the building, floor, size, and alike. The right of rent upon death is transfered to the family members, so that the tenants in 'Zinshaus' buildings stay there even for several decades. Those are the tenants who vested the rental right until the beginning of the 20th century and pay now-a-days the standardized and, in relation to the everage, somewhat lower rents of about 2 €/m².
In Vienna, there are about 35,000 buildings of the ’Zinshous’ type, but those typical are located in the downtown or broader center of the city. These edifices of grandious exterior have four to five floors and twenty to fifty apartments. Size of the apartments mainly ranges from 50 to 120 m², whilst luxurious apartments may occupy the entire floor of the building (200-300 m²). It is interesting to mention that ’Zinshaus’ attics are often refurbished into luxurious housing units of greater squaring and afterwards sold at considerably higher rates.
Managing and running of the housing facilities of this type are exceptionally well organized. The job of the former, so called, handyman at maintenance of an apartment house has been replaced nowadays by companies dealing with facility management whom the owner of the building is obliged to engage in order to maintain the facility and provide quality living conditons. In addition to the monthly net rent, the tenants pay for the costs of maintenance which usually amounts to 1-2 €/m².
In the Serbian capital there are no facilities of similar type in regard of ownership and tenant structure characteristic of ’Zinshaus’ in Austria. ’’Spiegelfeld International’’ has an interest to offer such a service to the market of Serbia, but it requires the corresponding legislation.
Apartment Rent in Belgrade
A great number of our capital’s inhabitants are incapable of appropriating a considerable sum of money for an apartment purchase so that people mainly decide to rent a housing unit. According to the inofficial data, at the moment there are more than 100,000 people who rent apartments in Belgrade. Rent rates are rather high, especially for apartments of less square meters whose rent rate requires an appropriation of some 200 to 400 Euros per a month. Larger apartments are in less demand at the real estate market, they are ’more convenient’, and their rent rates range from 300 to 550 and more Euros, depending on the squaring, location, equipment, etc.
Although apartment renting is regulated by the Law on Obligatory Relations (Rental Agreement) and the Law on Housing, in practice the agreements between a landlord and a renter as natural entities are generally concluded orally, they are neither signed nor verified at court, hence neither party is legally protected. Probably the main reason for avoidance of legal obligations is avoidance of income tax in the amount of 20% of the net rent rate, which the owner of the apartment is obliged to pay. The fact is that adherence to the Law would result in rent rate increase which certainly would not be at renters’ advantage.
Unlike the situation in other European countries where renting of the housing space is strictly regulated by Law which is administered in practice, the best and the safest for all those who let out or rent apartments in Belgrade and Serbia is to make an agreement which will protect both parties against any uncalled-for circumstances, whilst supplementary legislation that would motivate either party to fulfil their obligations is certainly necessary. If due to the very strict law, among the other things, even the real estate rates in Vienna managed to remain relatively stable despite the world economic crisis, why something like that would not be possible to achieve in our country as well?
Housing Facilities in Belgrade
Belgrade is the city built up and destroyed many times during its centuries-long turbulent history. Its oldest edifices are only about 200 years old. The capital's edifices were deteriorated by rough times and wars, but also by negligence of the tenants living in them and neglect of the city authorities. Belgrade today can nohow be called ’the white city’. Grey and deteriorated façades have been an ordinary picture of the capital for a long time, even becoming a menace to the passers-by and tenants.
For investment maintenance of buildings, including repairs of façades, roofs, gutters and elevators it is necessary to appropriate considerable financial means. According to the law, the means for apartment houses maintenance should be provided by the owners of apartments, whilst works are organized by the Tenants' Assembly. Unfortunately, due to huge costs, tenants rarely make such decisions.
The state looks after and carries out revitalization of the façades of the edifices under protection of the Cultural Heritage Preservation Institute, and through several programmes and projects conducted in the last few years the funds for repair of common parts of apartment houses were provided. One of such activities is the programme ’’Let us repair together’’ according to which the Assembly of the City will bear 70 per cent out of total costs, whilst the citizens who register for this project pay 30 per cent of the costs. In the world it is the other way round, 70 per cent are paid by the tenants and the state bears only 30 per cent. However, for our circumstances even 30% is too much. Unlike Belgrade, other European cities have strict rules. In Vienna, for instance, penalties are prescribed by law for the tenants who do not upkeep the façades, and similar situation is in other European metropolis.
Possibilities and perspectives
Proper functioning of investment and current maintenance of apartment houses provide the necessary standard of living, whereas a beautiful façade, clean and arranged common premises represent the picture of the tenants living in them. Thus, a joint contribution is made to better living conditions and higher housing quality.
In the tradition of European metropolis, the city authorities and state bodies should become aware of the actual situation in which a great number of apartment houses are. In order that the decrepit edifices could become proud witnesses of the capital’s charm and status, it is necessary to undertake activities at their reconstruction and maintenance, as well as at further housing and infrastructure development.
The facilities in the old city core which preserved the spirit of history and the architecture of the past times could be the subject of investors’ contemplations. With support of the public sector it is possible to construct new housing facilities whose housing units would be rented out under condition that the legislation existed, the rent height was standardized, maintenance was well organized, and both renter and landlord were legally protected.
Hence Belgrade, with buildings clean and pleasant for life and work, with representative authentic façades and European standards of maintenance would possess not only the spirit but also the beauty of a genuine European metropolis.
’’Spiegelfeld” has been exploring for a long time the prospects of finding locations and animating the interested parties for participation in construction of apartment houses where a square meter construction cost must be between 600 and 800 Euros. With such calculation, subsequent rent of an apartment of 50m2 would not exeed 250 Euros. The design has to be a joint activity of an investor, a bank and the state, but also of the future renter who could invest a minimal sum of money, say only 5,000 Euros, and repay the rest in 20, 30 years as a rent. It is one of the variants applicable at the Serbian market which is not a standard rent since one day the ownership of these apartments will be transfered to the renter.
One should be wise and clever and adjust the already positively confirmed and recommended experiences to domestic conditions under the obligation that the system is adjusted to positive experiences, and not to adjust these experience to the rigid system. It is necessary to take over some ideas and follow the traditional methods of doing business such as ’Zinshaus’ whose system of renting out, maintenance and operations at the market are an excellent respectable example. With minimal modifications this model has been used and existed at the apartment market in Austria for more than two centuries!