Deficiency of luxury real estate on south of Croatia

Croatia is a destination with great potential for the development of the luxury real estate market, in which Dubrovnik as a world brand has a leading role. Despite the current economic situation, there is no shortage of inquiries for luxury real estate in Dubrovnik and the surrounding area. Moreover, buyers of higher purchasing power are in constant search for exclusive real estate. Unfortunately, there is deficiency of this type of real estate in the Dubrovnik-Neretva County. In addition, in order to meet the wishes and needs of these clients, it is necessary to raise the entire infrastructure to a higher level.

Exclusive real estate in Dubrovnik
The existing real estate offer in Dubrovnik is not at the level to attract the world's elite. Luxury real estate in Dubrovnik still does not meet all the requirements set by such clients. In addition to a top location, larger square footage, the highest quality construction, attractive design and landscaped environment, it is necessary to provide a range of services for the maintenance of houses and apartments in this category.

In Dubrovnik, the construction of business and residential buildings for the local population is most pronounced, where the importance of the aesthetic dimension of architectural solutions and the necessity of landscaping the surrounding area in order to avoid visual pollution is sometimes neglected. Furthermore, it is not uncommon for clients to give up the purchase of an apartment that is well built and superbly equipped because it is located in an old and unrenovated building or house due to poor infrastructure nearby. Especially when it comes to luxury real estate, it is essential to pay attention to every detail so that the buyer truly gets value for money.
Location, location, location
The location of a property is crucial and is a key factor in determining its price. Additionally, the degree and quality of the property itself, but also the environment and the proximity of the facilities necessary for life, such as a shop, bank, post office, school, kindergarten, are certainly important in pricing.
Smaller cities with special geographical features, such as Dubrovnik, face a lack of top locations.
Many locations have already been used for houses and buildings that are often old or neglected, so they are not interesting to clients.

If we are looking for a villa first row to the sea for the client, we have to search outside of the Dubrovnik city centre, to the surrounding places where the infrastructure is not sufficiently developed. The question arises; can a villa built to the highest standards on the cliff by the sea, with a panoramic view of the Elafiti, without access road or with road in poor condition, be considered a luxury property? 

Unrealistic prices
The fact is that Croatia still cannot compete with the most developed countries with its offer of exclusive real estate, due to lack of luxury real estate or existence of ones that don’t meet the highest world standards. Even in the Croatian neighbourhood, the situation is not better. Although, for example, Montenegro boasts several projects that have turned parts of Kotor Bay into elite destinations with top hotels, restaurants, clubs, shops and marinas. However, the underdevelopment of other parts of the area, among other problems, makes it difficult to position these destinations in the global market.

In the Dubrovnik area, unrealistic prices of certain real estate also occur due to the small market, ie the lack of supply. Ultimately, the difficulty of finding the buyer, leads to lowering the prices and completing the sale at the end. Renovation, repair of damage or purchase of modern furniture are essential features that can increase the value of a property and justify its price.

Demand of luxury real estate still exist
Despite the pandemic and its consequences for the economy, interest in luxury real estate in Dubrovnik is not declining. Clients which are not affected by the crisis now want to take advantage of lower prices and invest in real estate. We recently sold a renovated stone villa in the heart of the historic centre of Dubrovnik, which is another indication that interest in such real estate still exist.

To compete with world destinations in terms of luxury real estate, we need to set our focus on careful construction planning with respecting geographical and landscape features, interior and exterior design, improving the entire infrastructure, renovating existing facilities in the best locations and providing a range of services required by buyers of such real estate. Dubrovnik has great potential; will we use it?

Author: Goran Pikunić