The decision, which is part of the measures for the business climate improvement in the former Yugoslav republic, states that citizens and companies from the EU and OSCE member states have the same legal and financial rights and conditions that apply to Macedonian citizens.

In addition, countries with which Macedonia has signed bilateral reciprocal agreements will also benefit from the changes. These are Slovenia, Croatia and Bosnia and Herzegovina.

The purchase of land is not included in the concessions.

The Macedonian government announced that it expects the reform package to result in the sudden rise of foreign investment. Deputy Prime Minister Zoran Stavreski said, as quoted by the Macedonian newspaper Utrinski Vestnik, that – combined with Macedonia’s expected NATO membership, the reforms may also lead to higher prices.

Over the past year, according to Macedonia’s Statistics Institute, real estate prices in the country rose by 13.8 per cent compared to 2006.

Foreign entities, both individuals and business clients, will now be able to buy property in Macedonia under similar contract terms, prices and market conditions  to Macedonian property buyers.

The measures are part of the Macedonian government’s 50 legislative steps aimed at liberalising the market and opening up the country’s real estate market to foreigners, adopted in the context of the business climate improvement strategy.

EU and OECD (Organisation for Economic Cooperation and Development) citizens will be entitled to owning property in Macedonia. Other countries will be treated in accordance with the reciprocity principle.

Foreigners will also be allowed to buy construction plots but not agricultural lands. These are still excluded from the market's real estate liberalisation programme, in order to protect .

Due to amendments in property laws, foreign nationals and legal entities will be able to purchase property and land in Macedonia, according to a recent decision by the government.

"The property law amendments will give foreigners the same rights as domestic legal entities and individuals when they buy real estate in Macedonia. Such liberalisation of the real estate market will attract foreign investments and improve the real estate market," said Deputy Prime Minister Zoran Stavrevski.

The amendments include only the citizens of EU and OECD countries, while the reciprocity principle applies to other countries. Stavrevski said the ministry of law should draft a list of countries in which Macedonian nationals are allowed to buy real estate and land so Macedonia can reciprocate.

Stavrevski explains that in this phase of amendments, foreign nationals will not be allowed to buy agricultural land because of state needs. "The liberalisation of agricultural land will begin after Macedonia becomes a full EU member."

Some real estate agents with the Economic Chamber of Macedonia expect that the liberalisation of the real estate market will bring an influx of tourists, since foreign nationals are interested in buying land and facilities mostly near lakes and in the mountains. In Bulgaria and Montenegro, for example, real estate prices per square meter drastically increased immediately after the liberalisation.

"Prices in real estate are affected by the market. There have been foreign investments in construction of residential buildings, so the prices per square meter increased only slightly," says Liljana Kovaceva, chairwoman of the real estate agents with the Economic Chamber.

Costs per square meter for a new flat in Macedonia range from 1,000 to 1,500 euros, while per square meter in older buildings runs between 650 and 850 euros.