Starting a Hostel Business in Belgrade


Foreign citizens have the same rights as Serbian citizens to purchase property for business use, although there are some restrictions – for example they cannot buy farm land and there are restrictions on city development plots or near military installations. It is also possible to buy commercial property within a Self Invested Personal Pension, which allows for significant tax breaks under UK tax law.

For those who would prefer not to buy outright, there is also the possibility of leasing land for commercial use for as short a period as five years up to a maximum of 30 years, with the option to extend further.

There are a number of tax and financial incentives for foreign investors, especially those who are purchasing property with a view to utilising it to boost the tourist industry which is on the rise in Serbia and is being actively encouraged by country’s government.

knez404One popular investment opportunity that UK investors may want to bear in mind when considering their options in the Serbian property market is to attempt to break into the ever increasing tourist market by investing in a backpackers’ hostel. Many of these can be purchased as complete enterprises, including existing contacts within the Serbian tourist industry, all furnishings, and even its own existing website, thus requiring very little input from the purchaser in order to turn it into a profitable enterprise. With Serbia’s low operational costs of running a business added into the mix, it is easy to see why such an investment presents itself as an attractive opportunity.

Investing in Belgrade’s tourist industry is a practical and forward thinking plan. The city is seeing more tourists pass through than at any time before, many of those being young people and students on gap years, and the type of accommodation that they are seeking is primarily hostels and low cost rooms. There is a huge demand for this type of service within the city centre as hosts of visitors from all over the world take advantage of the current low cost of living in Serbia to visit the country and explore the countless fascinating sites that are worth discovering.

Serbia is ideally located for backpackers touring Europe, being located at the heart of many other popular countries. It therefore encourages a lot of passing trade, and is rumoured to be well on its way to becoming one of the hottest gap year destinations. Belgrade is the focus of many of these students’ visits, with its wild nightlife and modern outlook. Because it is also considerably cheaper than many other European capitals, offering public transport and food that is affordable to those on a low budget, it often encourages visitors to stay for longer periods.

street lights in Belgrade

Serbia is also a year round destination, meaning that a regular income can be expected from your investment throughout the calendar rather than relying purely on the summer tourist trade to see returns. With its fascinating ancient past as well as its more unusual modern Communist history, there is a wealth of things to see and do here, from beautiful national parks to the Belgrade fortress and from the Nikola Tesla Museum to the Red Star Stadium. No wonder there is plenty to keep the backpackers occupied.

Serbia also sees regular music and sporting events that keep backpackers turning up to the country in droves, making investment in a hostel an appealing idea. The award winning EXIT festival, held every summer, draws crowds of young music fans, keen to see the lineup of international stars performing on the stage at Novi Sad’s Petrovaradin Fortress. There is also an annual jazz festival and Belgrade music festival that encourages visitors from all over the world to make Serbia their short break destination. The country also frequently hosts major international sporting events, with recent examples including the European Rowing Championships and the Davis Cup World Group Final. These too attract large numbers of tourists to the country, many of whom are looking for cheap hostel accommodation.

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