Improved transparency of Real estate transactions in Slovenia Marjan Čeh

Developing RE market – all types of transactions in Slovenia, Ljubljana 2005

Improved transparency of real estate market in Slovenia Establishment of common transparent computerized RE transactions database at Surveying and mapping authority of Republic of Slovenia Act on real estate agency; (Ur. list 42/03 ZNPosr). Directive - Real estate agencies transactions data management and distribution (Ur. list 93/04)

Internet version of RE transactions database

RE Transaction Types in SI Sale; on free market Sale; at public auction Sale; among persons from all possible inheritance relation Sale; due to expropriation Exchange Lease Rent; market rental price (square meter/ month) Rent; no market (nonprofit) netto rent price (per square meter, per month) building right

Real estate object types in RE DB Land Land with object Object types: Building Part of building Engineering object

Contract price records in SI Internal – agency transaction number (index of the job within the current year) Date of contract, time span of job (in days) from beginning of advertisement to contract date Netto amount (free of taxes, provisions to agency, operating costs) Calculated normalized price “per square meter”, from available price and area data. The prices must be recorded separately (price of land, building, part of a building), if the contract indicates them separately.

Subject data: Seller/s and buyer/s N ationality of each parity in contract No name and address

Definition of prototype – criteria from WG 3 Economy meeting in Ljubljana, SI Prototype object: Parcel of vacant,urban land, In the city size of national average (number of citizens in comparable town (settlement) is , plot size m2 In zone planned for detached housing, No infrastructure on the plot yet but, –it is possible to connect on the basic utilites (sewage, water, electircity, roads)

Prototype rights Existing rights: –ownerhip right –building right No obligations –no existing mortgages, servitudes, –no derived (future) mortgages, servitudes. All legal aspects of the property are correct (no disputes) - the contract is complete relative to the reality

Prototype subjects Buyer and seler –individuals, –both citizens of case state (not foreigner) –not companies –not in RE buissines Selers aim: –Sell a Parcel of land in Urban area Buyers aim: –Buy a Parcel of land in Urban area,

Prototype economic conditions Assume retional behaivour of parities: thay will register the property in LR. It is assumed that parities will not hire a valuer to determine the purchase price. Payment method of the purchsase price: cash payment with optional depositon of money to the notary, No credit (no mortgage) Purchase price (market value) around EURO Profesionals (Real estate agency or Lawyer) are hired to provide all necessary services and information provision: (collect data about their services costs!)

Transactions analyses process in SI DB atributes against prototype attributes 1.Definition of protoype criteria for sample selection 2.Selection of representatives according to prototype criteria in SI 3.Colect additional information about representatives (time of adverting, cost of agent, cost of notary, cost of surveyor, VAT, adminstrative fees) 4.Calculate costs for prototype entity – from representatives data 5.Compare costs of state representatives among participating countries.

Selection of representatives of prototype Step 1: Select comparable cites (towns) Step 2: Select parcels of urban land, Step 3: Select parcels of vacant land Step 4: Select plot size m2 Step 5: Select total price Euro

Selection of representatives in comparable cities – tabele in SI Kamnik26477 Krško27586 Slovenska Bistrica29285 Domžale29902 Velenje33331 Nova Gorica35640 Novo mesto40925 Koper/Capodistria47539 Celje48081 population range

Selection of representatives in comparable cities - map Number of transactions of vacant urban land (plot size m2)

Average area and average price/m2 of representatives in comparable cities

Sub class of selected representatives total price Euro KU_CODECADAST_MUNCITYAREATOTAL_PRICTOT_EUROSIT_M2EURO_M2 1448PREČNANOVO MESTO LAZEVELENJE BREZOVICADOMŽALE MOVRAŠKOPER MOVRAŠKOPER NEVLJEKAMNIK MEDLOGCELJE HRIBIKOPER MRAVLJEVINOVA GORICA ŠMARJEKOPER PŠATADOMŽALE STOPIČENOVO MESTO GODIČKAMNIK VINJA VASNOVO MESTO GRGARNOVA GORICA SVETI ANTONKOPER RAGOVONOVO MESTO ŠMARTNOCELJE ŠKOFIJEKOPER ŠMARCAKAMNIK GORENJA STRAŽANOVO MESTO

Distribution of representatives of prototype Closest match, representative of prototype KM_CODECADAST_MUN_NAMECITYAREATOTAL_PRICTOT_EUROSIT_M2EURO_M2 2618MOVRAŠKOPER

Conclussion Refine the prototipe criteria: –Set the radius from the capital city Next steps:  Colect additional information about representatives (time of adverting, cost of agent, cost of notary, cost of surveyor, VAT, adminstrative fees)  Calculate costs for prototype entity – from representatives data  Compare costs of state representatives among participating countries.