Buying property in Croatia – cost and fees
Croatia – beautiful country to live or retire or just to enjoy holidays
Croatia has much to offer for the property buyer, including an enormous variety of landscapes, a wide choice of unique cities, towns and villages, a great climate, wonderful beaches and crystal clear sea.
Its popularity really took off in 2001, and it promptly became one of the countries that were part of the ‘emerging market’ phenomenon. It opened up to foreign investors, who quickly took advantage of the inexpensive properties that were to be found throughout the country.
Anyone who wants ease of access from the rest of Europe, the clear waters of the Adriatic and an ever-improving infrastructure has got to visit Croatia. Croatia also officially became the 28th member state of the European Union in July, 2013. This is a result of the impressive progress made by the country as an independent state, and definitely helps to promote Croatia tourism-wise.
In addition, as of February 2009, the property market in Croatia became more open to European Union citizens who are now able to buy on the same terms as local Croats (except agricultural land and land in national parks). This burning of red tape in the buying process is not only speeding up the property buying procedure, it also encourage more buyers to purchase in Croatia with confidence.
To read more about the beauties of Croatia, please visit our About Croatia Blog Section.
Buying a property
Property buying in Croatia for non-EU citizens is governed by the principle of reciprocity meaning the right of an individual to buy property there is on the condition that Croatian nationals are permitted to buy property in the origin country of the purchaser. For EU citizens rule is that they buy in Croatia same way as Croatians, except agricultural land. If foreigner want to buy agricultural land, company has to be formed which will buy agricultural land.
As in all property transactions, the buyer should always use the services of an independent lawyer who acts solely for them. We are glad to recommend experienced and reliable solicitor. It is also essential that the lawyer should speak both Croatian and English fluently.
It is important for the lawyer to check that the property’s title is clean. Because Croatian families traditionally handed properties down from father to son for several generations, in some cases the paperwork is either incorrect or non-existent. Our agency checks all property documents to be sure that status and title are clean and without risk for buyer to purchase it.
Getting a survey done is somewhat unusual in Croatia, but it can be arranged through the agency or civil engineer or architect whom our agency can recommend. This service, with a proper translation, should cost somewhere around €500 should you require it.
There are two main routes for the purchase of property in Croatia – as a private individual or through a company structure that you set up yourself. There are advantages and disadvantages to both methods, and the best solution will be different for each specific case. We are experienced and professional real estate agency and will advise you of the best solution for each individual circumstance.
All steps in the buying process are described in details in our FAQ.
Buying Property in Croatia: Costs & Fees
- Estate agents charge 3 per cent of the property’s sale price
- Lawyers charge around 1.5 per cent (Lawyer which my agency recommend will charge about 0,5%, read more under FAQ). This will usually include the Land Registry ownership registration and the preparation of the purchase contract
- Permission from the Ministry of Justice for a foreign national to acquire property costs around 70 kuna (approximately 10 EUR)
- The notary’s fee and that of the translator (officially required) total approximately 500 kuna (around 70 EUR)
- The fee charged by the Land Registrar is about 250 kuna (approximately 35 EUR). Check with your lawyer whether this has been included in his or her fee
- Property transfer tax is currently set at 5 per cent, as of the January 2017. should be reduced to 4%. This is paid by the buyer. Once the transaction has been completed, the change of ownership should be registered within 30 days. The tax can be paid by money transfer, and is then changed into kuna
- Registering Croatian company (if buying through the company) – public notary fee is about 500 EUR, founding capital at company registration is 2800 EUR which you can take out of the company after registration, monthly fee for a bookkeeper is about 150 eur, yearly company tax is about 150 eur.
VAT (PDV in Croatia) is currently 25% and payable only on the value of a newly constructed building or a resale for which the VAT was already paid, if disposed of by a business VAT payer. It is also charged on the services provided by both real estate agents and legal advisers.
Real Estate Mortgages
The finance industry in Croatia was subject to a quite a large amount of change. Unfortunately Croatian banks have not recognized foreigner buyers as perspective clients, so only few banks will consider foreigner for approving bank loan to purchase property and with very difficult conditions to be fulfilled by the foreign buyer. It is our recommendation for a foreign buyers to look for suitable bank loan in the native country. Number of our German buyers were approved loans from the German banks to purchase property in Croatia.