Croatia, with its stunning coastline, historic cities, and warm Mediterranean climate, has become a highly desirable destination for property investment. Since joining the Schengen Area and the Eurozone, the country has attracted an increasing number of foreign buyers looking to purchase houses, apartments, and land. Whether you’re looking for a vacation home, a rental investment, or permanent residency, here’s a comprehensive guide to help you navigate the process smoothly.
Before purchasing property in Croatia, a thorough due diligence process is essential. This includes verifying the following documents:
Land Registry Extract (Vlasnički list): Confirms ownership, any existing liens, and legal status.
Building and Use Permits: Ensure the property was legally built and is habitable.
Zoning Regulations: Check local planning laws to ensure there are no restrictions on renovation or use.
Main Construction Project (for new builds): If buying off-plan, review the construction permit and building plans.
It’s highly recommended to work with a licensed real estate agent or lawyer to ensure the property has a clean title and to avoid potential legal issues.
Once you have confirmed the property’s legal status, the next step is signing a Preliminary Agreement (Predugovor) or the Final Purchase Agreement (Ugovor o kupoprodaji). Key points include:
A deposit (kapara) of 10% is typically required.
If the buyer backs out, they forfeit the deposit.
If the seller backs out, they must return double the deposit.
Contracts must be notarized by a public notary.
Having a legal expert review or draft the agreement ensures your rights and interests are protected.
EU citizens can buy property in Croatia under the same conditions as Croatian nationals.
Non-EU citizens must obtain approval from the Ministry of Justice. This process requires:
If a reciprocity agreement does not exist, foreigners can establish a company (d.o.o.) in Croatia and purchase property through the company.
The remaining 90% of the purchase price is typically paid upon final contract signing.
The property must be registered in the Land Registry (Zemljišne knjige) to transfer ownership officially.
A Tabular Statement (proof of full payment) is required for registration.
Real Estate Transfer Tax: 3% of the purchase price (unless the property is subject to VAT).
VAT (PDV): If the seller is a business entity, VAT 25% is included in price, you don't pay additional Transfer Tax
Notary Fees: Varies based on contract complexity.
Agent Commission: 3% plus VAT.
Property Maintenance Costs: Ongoing expenses such as utilities, security, and communal fees.
Hiring professionals can streamline the process and minimize risks:
Real Estate Agent: Helps find legitimate listings, negotiate prices, and handle paperwork.
Lawyer: Ensures all legal aspects are covered, provided by Agency
Tax Advisor: Provides guidance on tax obligations.
Translator: Assists with legal and bureaucratic documents.
Most Croatian banks do not offer mortgages to non-residents, so foreign buyers often:
Pay in cash.
Secure financing from a bank in their home country.
Take out a loan through a Croatian company they establish.
Understand local building codes before making structural changes.
Work with reputable local contractors.
Consider property management services if you don’t plan to reside year-round.
Croatia has strict rental regulations. A rental permit is required for short-term stays.
Rental income is subject to personal income tax.
Consider hiring a local property management company for hassle-free operations.
Owning property does not automatically grant residency.
Long-term visas are available for non-EU citizens with property in Croatia.
Digital Nomad Visa: Croatia offers a one-year temporary residence permit for remote workers.
An OIB is essential for purchasing property in Croatia. It serves as your personal identification number used for tax purposes and official records. Without an OIB, you cannot enter into property purchase contracts or register ownership in land records123.
Visit any Tax Administration office in Croatia or apply online through an authorized representative46.
Submit an application form along with identification documents such as your passport or European ID card56.
The process is free of charge and typically completed within minutes or on the same day46.
A real estate agent or lawyer can assist with obtaining your OIB to streamline your purchase process
Buying property in Croatia can be a lucrative and enjoyable investment, but it requires careful planning. Working with experienced professionals and understanding the legal and tax landscape will ensure a smooth purchasing process. Whether you’re looking for a seaside villa, a city apartment, or a countryside retreat, Croatia offers excellent opportunities for foreign buyers.
For professional guidance, reach out to Mladen Tićak from Dux Real Estate to help you navigate the Croatian real estate market with confidence!