The content of the article:

• Croatia is in the Schengen area
• The reasons for the increase in the cost of housing
• Opportunities for foreign buyers
• Important for non-EU foreigners

In January 2023, Croatia (after ten years of being part of the EU) became another country of the Schengen area, which influenced the change of the national currency (kuna) to the euro. And despite analysts' forecasts that real estate prices will not grow much, literally in a year the average price per square meter increased by almost 21%, reaching a record figure of € 3,223 per square meter. Of course, this cost depends on the location of the object, the year of construction (secondary or new building), on the condition (repair is required or not). At the same time, according to the Statistical Office, in the first months of 2024, prices in the secondary real estate market increased by 9.5%, and for new buildings — by 6.8%. What are the forecasts for the end of the year? Due to the increase in prices and to protect its citizens, the Croatian government has introduced a real estate tax to regulate rentals. This tax is intended to resolve the imbalance between the taxation of short-term and long-term rentals. The new tax will not apply to residential real estate for permanent residence, as well as to objects that are rented out for long-term rent. Perhaps the information about these changes in tax legislation has stirred up a large number of buyers of Croatian real estate. Analysts predict that there will be no further increase, but no one guarantees this.
Of course, apartments and houses are mostly bought up on the Adriatic coast of the country. Although at the beginning of 2024, the price increase did not occur there or in the capital of Croatia, Zagreb, but in other regions where real estate prices are more affordable. This is primarily due to the fact that many foreign investors prioritize not only the “first coastline”, but also developed infrastructure, landscape and nature. The main buyers of real estate on the Croatian coast have long been citizens of Germany and Austria, but in 2023 and early 2024, most of the transactions were made by citizens from other countries. This is also due to the fact that in the current economic and political situation, many entrepreneurs prefer to withdraw savings from banks and buy real estate. Due to the stable demand for tourist accommodation and rentals, in the popular and sought-after regions of Croatia, the annual income from rent can reach 8-10%.

The main objectives of foreigners in the Croatian real estate market are:

• buying a house in the south of Croatia as an alternative to a vacation vacation in a Mediterranean climate
• is a rental business. As noted above, thanks to tourists, the property becomes a good passive income.
• There are no large castles and apartment buildings on the Croatian coast (as in Spain and Italy), which preserves nature and landscape in its original form and attracts a large number of “eco-tourists" and investors
• However, there are also negative aspects. It is very difficult to buy real estate in Croatia with funds from state banks, since interest rates are higher than in many other European countries. Most private entrepreneurs make purchases out of their own funds or with the help of loans received in their country. 
• For those businessmen who plan to purchase agricultural land, the government has introduced restrictions: now private entrepreneurs can purchase such land up to 10,000 sq.m. To solve this problem, many foreign investors create their own company in Croatia and already have the right to EU subsidies and the opportunity to buy plots of land exceeding the restrictions. 
• In addition to land plots, many foreigners invest in facilities under construction at the “pit” level, which on the one hand is beneficial in the price segment (it is cheaper than buying ready—made housing), and on the other hand is energy-consuming, since it does not make it possible to profit from this facility or immediately use it for living. 

Despite the fact that the state is investing in the construction of new residential complexes, nevertheless, due to a certain geographical location, not all plots of land are suitable for this, therefore it is becoming increasingly difficult to find a suitable object in popular tourist areas — Dubrovnik, coastal Istria, Split and Zagreb. We advise you to pay attention to the commercial facilities offered in our catalog
It should be noted that citizens of the member States of the European Union or one of the four European countries for which the same rules apply can purchase real estate on the same terms as citizens of the Republic of Croatia. They do not need consent from the Ministry of Justice and the Administration. But there are certain requirements for foreigners from other countries.

Instructions for foreign buyers from non—EU countries:

• to purchase real estate in Croatia, you must obtain permission from the Ministry of Justice and the city administration (at this stage, reciprocity between the buyer's country and the Republic of Croatia is checked)
• foreigners can rent real estate in Croatia through a legal entity - a company opened in the territory of the Republic
• for registration of ownership rights foreigners need to issue an OIB (personal identification number)
• the property transfer tax (3% of the purchase price of the object) is paid by the buyer
• foreigners often make a deposit (3-5%) to reserve the price of an object they like. This makes it possible to collect a package of necessary documents and not miss the chance of a bargain purchase. However, in case of refusal of the transaction, the deposit is not refunded
• when making the transaction, it is better to use the services of experts who know the market and the legislation of Croatia. They will help bring the procedure to a positive result and get rid of fraudulent actions by unscrupulous sellers and realtors
• It is impossible to obtain a residence permit and citizenship of Croatia through the purchase of real estate. You can read about the Croatian residence permit in the article 

Croatia is attractive for its ecology, clean beaches and mineral springs. The tourist season is open in the country all year round, and ski resorts are not inferior to Switzerland and Austria, although they are much cheaper. There are many business niches in Croatia that can be occupied by entrepreneurs from different countries: wellness centers and spa hotels, parking lots, new residential complexes for the local population, etc. Our experts will help you decide on the choice of an object and make the right purchase.