Croatia

Has anyone ever bought an investment property/apartment in Croatia ?

I've read on International Property Alerts, that the reconstruction of the Rijeka Gateway, the principal seaport of Croatia, will transform the city and push up property prices. This should improve passenger and cargo transport in Rijeka and bring in more tourism to nearby Istria. Some peopel reckon that by 2009 everything will go up & that now is the time to invest.

I've seen property for sale there but no mention of management agencies or what the legal/tax situation is like.

Perplexed, I went out working and have since bought in Croatia. Rijeka is okay, but it's a port city, not so clean and also rather chilly in the winter. Istria is being over built (my colleague will kill me for this) and to find a nice little bargain it might even be worth looking inland in say, Zagreb, Slavonia or even Varazdin. All are busy with high demand for rentals (year round). You can get the usual summer stuff down on the coast, but you seem to want a year rounder? I can send you details on taxes etc if you wish, oh, and before you get confused, you can buy as a private individual!

Almo,
Thanks for your info. I take it you're still living out there & have a good handle on the different areas. Do you agree that Croatia is a good bet for investment & rental ? I see from other threads that you gave great warnings about Montenegro. That's what I like to hear ....some honest info & not agency speak.

A nice apartment overlooking the beach looks very appealing at around €50k, but that's just a notion. I don't have time to visit much so a year round rental would be a better idea.

Where would I source property in say Zagreb ?

Yes, I'm very interested in the Tax situation & if they'ge got all the legal bit sorted out. I believe this used to be a problem out there ie. a few different people claiming title.

Hi,

I am very interested in property in Croatia. Spent a week last year in Dubrovnik and loved it, and am hoping to go back this year and further up the coast. What do people think about the town of Trogir / Island of Ciovo? about 30 mins from Split and on the coast - would love to hear some opinions.

Perplexed, Montenegro is a wonderful place, I say it with hand on heart, and it'd be great to buy, but I just found it a little too dodgy, for now anyway, but by the end of this year there might be some sort of resolution (I can't see them resorting to civil war, the EU and UN would not want it to happen).

I know of only one good agency operating in Zagreb, I don't have their details handy but will PM them on as soon as I get them. There is a drawback there, in the area, and that is that it's expensive enough to begin with. but you get your rentals and will be able to sell on.

In regards to title (John Gonne this is relevant to you and I guess you already have found this) that in areas like Dubrovnik, Split, Zadar etc there are as many (I honestly couln't say more) houses with problem papers than say where I live (Knin), where you'd expect it to be rampant! But once you have a good lawyer, know what to look out for and a good agency then you won't be sent wrong.

There was a lot of kerfuffle over new builds in and around Trogir, some irish agencies were involved and a lot of unhappy campers were the result, but the problem lay with the agencies being lazy and not doing their own legwork and relying on local agents to source and sell the property. I know personally of one that my colleague went down to check, he smelled a rat but all the papers seemed to be in order. He did a small check and found that there was a mortgage on the land and on the building too (a new apartment block), when he went back to the main agent they kept to the old maxim "No problem!"

Trogir is nice John, but not overly clean, a nightmare to get through (esp onto Ciovo) in the summer months and that 30mins to Split soon turns into over an hour in traffic (I have the saddle sores to prove it!). You could look at Seget (a little cheaper too) or even further north along the coast, Primosten, Rogoznica, Vodice, an hour covers the trip to Split plus you're an hour from Zadar Airport, just suggestions though.

Oh Perplexed, just forgot, the overall tax situation is soon to be reviewed, which is a good thing. And all you have to remember is that when you buy you wait until your name is on the title deeds and then you pay the 5% transfer tax. Sell within 3 years and pay 35% CGT on the difference between the amounts. It's very straightforward and starting to speed up!

Almo,
Thanks so much for all your info so far. Very interesting. Keep it coming !
Is there a better deal with CGT if you hold onto a property for longer than 3yrs ? In some countries the tax reduces if you hold for say 10yrs..

Is there a double taxation agreement with Ireland? Alternatively do you know of any website with all the info so's I may stop bugging you, with all these questions ?

Once you're out of 3 years you're pretty safe. It's really bad ot say but there is no true guide to taxes in Croatia, even last Sunday there was a write up by a "tax expert" in the Business Post and he got it horribly wrong! I have a guideline sheet my colleague did up, it's on the pc back in the office but I'll get him to send it over today.