If you’re on the lookout for a Mediterranean destination to move to or invest in real estate, look no further than Croatia. Croatia has long been a hidden gem in the European real estate market. With its stunning natural beauty, rich history, and sunny Mediterranean climate, it’s no wonder that buyers and investors are starting to take notice of this, not so long ago, little-known corner of Europe. Let’s explore the state of real estate prices in Croatia and what makes this market so attractive to buyers and investors alike.
The rise of Croatia’s real estate market
Over the past few years, Croatia’s real estate market has experienced a significant rise in both demand and prices. According to recent data from the Croatian Bureau of Statistics, property prices have increased by an average of 6.4% per year since 2015. It seems that the trend is accelerating, so, for example, real estate prices in Croatia in 2022 increased by 14.8 percent more than the year before. This trend is expected to continue in the coming years, as more investors discover the potential of the Croatian real estate market.
What’s Driving the Growth?
One of the main drivers of growth in Croatia’s real estate market is its burgeoning tourism industry. Croatia has become a popular destination for tourists from all over the world, thanks to its stunning coastline, historic cities, and picturesque islands. As a result, many investors are turning to the Croatian market to purchase holiday homes or rental properties that cater to the growing number of visitors.
In addition to tourism, Croatia’s real estate market is also benefitting from the country’s improving economy. In recent years, Croatia has made significant progress in reducing its budget deficit and stabilizing its economy, which has led to greater confidence among investors. This resulted in increased demand for real estate not only in the tourist regions of Croatia, but also in most major cities such as Zagreb, Rijeka and Split.
Real estate prices in Croatia – the cost of buying property
Despite the recent rise in prices, buying property in Croatia is still relatively affordable compared to other European countries. In the first half-year of 2022, the average price per 1 m2 of new dwellings sold by trade companies and other legal entities, was 2.176 €. It was 16.1% higher than the price in the second half-year of 2021 and 21.1% higher than the price in the first half-year of 2021.
The average price per square meter for an apartment in Zagreb is around €1,700, while in Split, it’s around €2,300. In popular tourist destinations such as Dubrovnik, prices can be higher, with the average price per square meter for an apartment around €3,500.
It’s also worth noting that foreign buyers can purchase property in Croatia with relatively few restrictions. Non-EU citizens can buy property in Croatia, although they may need to obtain special permits or approvals from the Croatian government.
Tips for Investing in Croatia’s Real Estate Market
If you’re considering investing in Croatia’s real estate market, there are a few things to keep in mind.
- A reputable real estate agent
Firstly, it’s important to work with a reputable real estate agent who is familiar with the local market and can help you navigate any legal or administrative hurdles.
- The location of the property
It’s also important to consider the location of the property carefully. While tourist hotspots like Dubrovnik can be a safe bet for rental income, they may also be more expensive and competitive. On the other hand, up-and-coming areas like Split or Zadar may offer greater potential for growth and capital appreciation.
- Be aware of any potential risks
Of course, it’s important to be aware of any potential risks associated with investing in a foreign market. Factors such as political instability or fluctuations in currency exchange rates can impact the value of your investment, so it’s important to do your due diligence and keep an eye on any developments that could affect your investment.
Croatia’s real estate market is a hidden gem on the Adriatic coast, offering investors the opportunity to purchase property in a stunning and rapidly-growing market. Real estate prices in Croatia are still affordable compared to other European countries. With its beautiful coastline, rich cultural heritage, and improving economy, Croatia is quickly becoming a top destination for buyers and investors from around the world. By working with a trusted real estate agent, carefully considering the location of the property, and keeping an eye on any potential risks, investors can take advantage of the exciting potential of this vibrant market.