How to Buy Property in Croatia?
Igor Katušić , Tuesday, 19 November 2013
This article is part of a series of 8 articles about buying property in Croatia. The other articles in the series cover the following topics:
In general, we could say that the process responsible for buying a real estate anywhere in the World is based on the same principles but with a specific set of sub regulations for each country. Same applies for the Republic of Croatia. When buying a real estate in Croatia, you should be familiarized with those regulations and procedures.
Real Estate Purchase Eligibility Rights
First of all, there are three (3) major types of purchase eligibility rights when it comes to buying of a property in Croatia:
Since 2009 citizens of EU member states share the same rights as any other Croatian citizen when starting the process of purchasing a property in Croatia. That’s due to the fact that around that time, Croatia was at its peak of the negotiations for a full EU membership and it was a part of the series of regulations which aim toward the regulations’ leveraging between member states.
As from July 2013 Croatia is a full member of European Union which further sealed the regulation of purchasing the real estate in Croatia from behalf of EU member state’s citizens.
This correlates to the first type of eligibility rights in a real estate buying and ownership rights’ legal procedure.
Citizens of the Countries which have signed the Mutual Reciprocity Agreement with Croatia
Over the time, Croatia has signed a waste number of Mutual Reciprocity Agreements with different sovereign countries throughout the World. That list is actually a list of those countries whose citizens are allowed to buy a real estate in Croatia and vice versa, under a specific set of sub regulations.
If you are a citizen of a country that has signed this Agreement, then those specific regulations are applied for you in order to become an owner of a property in Croatia.
Citizens of the Countries which have not signed the Mutual Reciprocity Agreement
The last type applies for the citizens of the countries that haven’t signed the agreement and are non-EU citizens. If you are a citizen of a country such as this – you are not eligible to buy a real estate in Croatia as an individual. You would need to start a company and then buy a property though the entity of the company itself.
Mortgages and Bank Loans as a Part of a Buying Process
One thing to consider when deciding to buy a real estate here in Croatia is the budget. How much would you be willing to pay for a specific real estate? Do you have enough or you need the mortgage?
For the argument sake, let’s presume that you really do need the Bank Loan and/or Mortgage in order to buy a real estate.
That can of course be achieved through some of couple of dozens of banks in Croatia which are offering different solutions based on your need as the buyer. In general, interest rates range between 5.8 and 7.5 percentiles. The most popular is definitely a mortgage based loan where the property itself serves as an insurance of the loan.
Legal Subjects (Legal Entities) in a Real Estate Purchasing Process
Many countries share the same principles regarding to the roles of the key legal subjects and entities in a real estate purchasing process. From you and the seller, via a real estate agent, to a lawyer and notary – all play a significant role in the process.
Real Estate Agent
Without any doubt, a real estate agency, thus a real estate agent has a crucial significance from the beginning to the end of the process. Remember, you are trying to buy a real estate in a foreign country – don’t start on your own; use a licensed real estate agent.
In Croatia, a real estate agency needs to be a licensed after undergoing the series of obligatory tests from behalf of an official state’s entity. In other words, you don’t have to worry about the possibility of doing business with someone who is not a legitimate real estate agent.
Lawyer
His part of the process is highly important due to the fact that the legal representative, who is an expert in the field, will eliminate any possible risk involved in a property purchase procedure. It’s a must for any kind of real estate trade. Lawyer has to make sure that every single aspect of the business is done according to the latest legislative procedures and regulations, thus to make sure you can actually buy a real estate and claim the ownership.
Notary
The final seal, hence the crown of the entire process has to be done by the office of a legal Notary. Every single document related to the buying of a real estate (contract, mortgage, ownership claim, etc…) will be thoroughly checked and verified by the Notary. He is the final step of the process.
Buying Process in General
This is a condensed overview of the buying process itself:
This article is part of a series of 8 articles about buying property in Croatia. The other articles in the series cover the following topics:
In general, we could say that the process responsible for buying a real estate anywhere in the World is based on the same principles but with a specific set of sub regulations for each country. Same applies for the Republic of Croatia. When buying a real estate in Croatia, you should be familiarized with those regulations and procedures.
Real Estate Purchase Eligibility Rights
First of all, there are three (3) major types of purchase eligibility rights when it comes to buying of a property in Croatia:
- Croatian and European Union citizens; who shares the exact same rights in a matter.
- Foreign citizens of the countries which signed a Mutual Reciprocity Agreement.
- Foreign Citizens of the countries which have not yet signed the above mentioned Agreement.
Since 2009 citizens of EU member states share the same rights as any other Croatian citizen when starting the process of purchasing a property in Croatia. That’s due to the fact that around that time, Croatia was at its peak of the negotiations for a full EU membership and it was a part of the series of regulations which aim toward the regulations’ leveraging between member states.
As from July 2013 Croatia is a full member of European Union which further sealed the regulation of purchasing the real estate in Croatia from behalf of EU member state’s citizens.
This correlates to the first type of eligibility rights in a real estate buying and ownership rights’ legal procedure.
Citizens of the Countries which have signed the Mutual Reciprocity Agreement with Croatia
Over the time, Croatia has signed a waste number of Mutual Reciprocity Agreements with different sovereign countries throughout the World. That list is actually a list of those countries whose citizens are allowed to buy a real estate in Croatia and vice versa, under a specific set of sub regulations.
If you are a citizen of a country that has signed this Agreement, then those specific regulations are applied for you in order to become an owner of a property in Croatia.
Citizens of the Countries which have not signed the Mutual Reciprocity Agreement
The last type applies for the citizens of the countries that haven’t signed the agreement and are non-EU citizens. If you are a citizen of a country such as this – you are not eligible to buy a real estate in Croatia as an individual. You would need to start a company and then buy a property though the entity of the company itself.
Mortgages and Bank Loans as a Part of a Buying Process
One thing to consider when deciding to buy a real estate here in Croatia is the budget. How much would you be willing to pay for a specific real estate? Do you have enough or you need the mortgage?
For the argument sake, let’s presume that you really do need the Bank Loan and/or Mortgage in order to buy a real estate.
That can of course be achieved through some of couple of dozens of banks in Croatia which are offering different solutions based on your need as the buyer. In general, interest rates range between 5.8 and 7.5 percentiles. The most popular is definitely a mortgage based loan where the property itself serves as an insurance of the loan.
Legal Subjects (Legal Entities) in a Real Estate Purchasing Process
Many countries share the same principles regarding to the roles of the key legal subjects and entities in a real estate purchasing process. From you and the seller, via a real estate agent, to a lawyer and notary – all play a significant role in the process.
Real Estate Agent
Without any doubt, a real estate agency, thus a real estate agent has a crucial significance from the beginning to the end of the process. Remember, you are trying to buy a real estate in a foreign country – don’t start on your own; use a licensed real estate agent.
In Croatia, a real estate agency needs to be a licensed after undergoing the series of obligatory tests from behalf of an official state’s entity. In other words, you don’t have to worry about the possibility of doing business with someone who is not a legitimate real estate agent.
Lawyer
His part of the process is highly important due to the fact that the legal representative, who is an expert in the field, will eliminate any possible risk involved in a property purchase procedure. It’s a must for any kind of real estate trade. Lawyer has to make sure that every single aspect of the business is done according to the latest legislative procedures and regulations, thus to make sure you can actually buy a real estate and claim the ownership.
Notary
The final seal, hence the crown of the entire process has to be done by the office of a legal Notary. Every single document related to the buying of a real estate (contract, mortgage, ownership claim, etc…) will be thoroughly checked and verified by the Notary. He is the final step of the process.
Buying Process in General
This is a condensed overview of the buying process itself:
- Locate a real estate agency which operates in a targeted area.
- After making the final choice, along with the real estate agent, visit the office of a lawyer who is experienced in this type of legal matters and hand him over all relative documents for the inspection.
- Fund the Escrow (5-10 % in average).
- Sign the contract with the seller, after that contract is pre-checked by the lawyer.
- Go to the Notary office and verify the contracts and other needed documents.
- Make the payment.
- Start the ownership claim procedure.
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