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Buying Property in Croatia

The main issue with buying property in Croatia is to establish whether the property has a "clean" title. The property market in Croatia has only really existed in its current form for the last 10 years.  Prior to that time records were not as rigorously kept as they are now. Properties would be handed down from generation to generation and as a result a particular property could well have ended up being co-owned by several members of the same family. In some cases it could be difficult and time consuming to trace all the co-owners. 

When buying a property in Croatia, it is imperative that the precise ownership of the property being purchased is established as soon as possible. It is important to verify that the seller is indeed the owner entitled to sell that property, and that the property complies with all building regulations. 

The diagram below provides a simplied outline of the buying process and the typical costs involved. You may wish to also refer to our Property Buying FAQ's page for more information and clarification.

As this is a simplified and generalised version of the buying process, do please contact us for more detailed information based on your circumstances.

 

Step 1:  Offer Acceptance
Vendor accepts buyers offer
Step 2:  Goodwill Deposit
Buyer deposits refundable "Goodwill Deposit" with Croatian Villas For Sale usually amounting to 3% of proposed property purchase price

Funds deposited & held in UK client account
Step 3:  Initial Searches
Solicitor engaged to carry out property searches in order to verify that the property title is clean & undisputed. Preparation of pre-contract and contract
Searches OK?
YES
NO
Goodwill Deposit returned to buyer
Buyer chooses to  proceed with purchase?
YES
Goodwill Deposit retund at pre-contract signing
NO
Buyer forfeits Goodwill Deposit
Step 4: Private or Company Ownership?
Private Ownership
Company Ownership
There can be some advantages to creating a Croatian Limited Liability company that will own the property

Fees for this typically =
Legal: 2000
Company operating capital deposit = 3000
Step 5:  Pre-Contract
The pre-contract defines the terms of the final contract (deposit, payment terms, settlement date)

Fees payable typically  =
Property Deposit: 10%
Croatian Villas For Sale Part-Fee: 1.5%
Legal Fees: 1%
 
Should the buyer NOT proceed with the purchase past this point, the buyer forfeits the full Property Deposit, Part-Fees & Legal Fees

Should the vendor NOT proceed with the sale past this point, the vendor refunds the buyer double the Property Deposit
Step 6:  Contract
The contract is the final binding document.
Settlement results in full payment of the final purchase price less deposit paid. Also payable is the balance of Croatian Villas For Sale fees of 1.5% + Legal Disbursements approx 200
Step 7:  Ministry of Justice (MoJ) approval required?
YES
for non-EU citizens if private ownership route taken

The MoJ verifies that the buyer is a citizen of an approved country & that the property to be purchased is of an approved type (eg, not farmland, forests, etc)     
NO
for EU citizens or if
company ownership route taken
Step 8:  Land Registration
Registration of ownership with the Land Registry
Step 9:  Real Estate Transfer Tax (RETT)
Similar to UK Stamp Duty, 5% RETT is payable to the authorities

Any improvements made to the property prior to MoJ approval (Step 7) will result in RETT being applied to the property valuation after the improvements
LEGAL OWNERSHIP
Final costs typically 109% of purchase price + Legal Disbursements
(excluding Company set-up costs if that route is taken - see Step 4)






















































































































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