Often confused with Slovakia, Slovenia is actually the most westerly of the countries that formerly comprised Yugoslavia. 
 

Of all the former Yugoslavian countries, Slovenia was the one that was least affected by the war there.  Fighting only lasted there for 10 days and there was very little damage to the infrastructure.  Slovenia then very neatly became independent in 1991 and was left in peace by the other warring factions in Yugoslavia.

Yugoslavia was never fully controlled by the Soviets as the other territories in Eastern Europe was and so it was economically advanced compared to the other major countries in the region.  In all of the other Yugoslavian countries, this advantage was totally wrecked by the war.  The success of Slovenia shows that, had Yugoslavia not dissolved into conflict, it would probably be a major European economic powerhouse by now.   On Propertastic! we tend to use the phrase ‘with the exception of Slovenia’ a lot.  This is because Slovenia is very different in many respects from most of the countries in Eastern Europe.  Economically, it is far advanced from any of the other territories that we cover here, with the average Slovene having a standard of living only 25% less than the average Briton.   Slovenia joined the EU along with the other major Eastern European countries in May 2004.  Since then, it has managed to show that it is definitely a step ahead of the other ‘new kids from the bloc’ by being the only new entrant so far to join the Eurozone, having been admitted on 1 January 2007.  Another sign of the country’s economic maturity is that it will be the first

of the newbie countries to hold the Presidency of the European Union, which they will hold during the first half of 2008.

Both of these events should tell you that Slovenia is the most secure of all of the countries that we cover on Propertastic!  If you are an ultra-cautious investor who is likely to lie awake at night sweating even if there is the teeniest-tiniest element of risk to your investment, then perhaps Slovenia is the right country for you to be putting your money into.

If you do, you will not be alone.  Slovenia was tipped by Channel 4’s ‘A Place in the Sun’ programme as the best place to invest over the next 10 years, with predicted increases of 250% over that period.  Knight Frank are similarly bullish about Slovenia, putting it in their joint number two position along with Latvia for 2007 with a predicted growth of 17.5%.

However, before you get too excited, there are some other factors to take into account.  It is hardly breaking news that Slovenia has got its act together and is a safe place to invest in, with the result that the capital, Ljubljana, is currently the most expensive city that we cover on the site.  Although there are certainly going to be more price increases in the future, it’s hard to believe that it can continue such a pace over the long-term.  Remember how there was a lot of speculation in Warsaw, Prague and Budapest in the run-up to EU accession in 2004 followed by a plateau in the years following?  It’s possible that Slovenia’s recent entry into the Eurozone could have the same effect.

Another reason as to why Slovenia might not be the right country for you has to do with the range of mortgage products available.  Although they have become a little better over the last 12 months, they are still the least attractive of the EU member countries, with a Loan To Value of only 50%.  Obviously if you are remortgaging your UK property, this is not a problem.  But if this is not an option, a combination of high property prices and low LTV ratios means that you’re not going to get a lot for your money in Ljubljana.

If you’re looking instead for a holiday home, Slovenia might be an option as it has some beautiful Adriatic coastline.  The bad news is that it doesn’t have very much of it – less than 50km of it.  Although prices are currently not significantly higher than the more prestigious coastal towns of Croatia, the fact that the coast is a very easy drive for Italians, and Austrians, not to mention the increasingly affluent Slovenes themselves means that there is going to be a lot of competition for properties that are available here.

The bottom line is that if you are looking for a rock solid safe investment and are planning on buying something quickly, it will be possible to make some good money from buying in Slovenia.  However, as the other Eastern European countries really start to take off, chances are that the current interest in Slovenia will start to wane a little.

Additional Background Information

Key Economic Data      Slovenian Climate      Visitors' Guide

The above contains our thoughts on the current state of the market.  But, like any type of investment, there are no guarantees as prices are always influenced by a huge number of different variables.

You can keep abreast of developments in the market by checking out the articles in our News section where we’ve trawled the Internet for every story connected with property in Slovenia so you don’t have to.  By checking the news reports regularly and thinking through the consequences of each piece of news, you should be able to get a good idea as to how quickly or slowly property prices in the market are going to rise in the near future.

The information in this section only tells half the story, however as only a small proportion of Slovenian property news is translated in English, which means that the locals are getting a lot more useful information than foreigners are.

Investing in the wrong markets could make the difference between making tens of thousands and losing tens of thousands over the next few years.  If you’re seriously considering investing in Slovenia, then you should think of subscribing to our Premium Service so that you can get all the breaking news from the market at the same time the Slovenians are hearing it.

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