All costs when buying real estate in Croatia

UPDATED: 23.05.2023.

When buying a new property in Croatia, there is a lot to think about and consider. The sales price of the property is usually at the top of that list, but there are a lot of other costs involved as well. These costs may or may not be similar to what you are used to in your home country.

Aside from the price of the property itself, there are some other costs that are not as obvious, especially to foreigners relocating to Croatia. To be clear, there are costs of purchasing real estate in Croatia, and there are costs of owning real estate in Croatia.

This article covers all possible costs associated with buying a property. Soon we plan to publish an article on all costs of owning a property, so keep your eyes open.

In this post, we cover:

• Cost of the property itself
• Down payment
• Deposit
• Real estate agency fees
• Lawyer fees
• Evaluation of the property
• Fees at notary public
• Official court translator
• Property transfer tax
• Renovation costs
• Moving costs
• Insurance
• Get with purchasing a property

The facts are these…

All costs when buying real estate in Croatia

#1 Cost of the property itself

The biggest cost that you will have when buying a property is the cost of the property itself. The cost of a property in Croatia depends on various factors.

These factors include:

• Current state of the real estate market
• Time of year
• City/place where the property is located
• Exact location of the property, i.e. neighborhood
• Proximity to the city center
• Proximity to the sea
• Floor on which the property is located
• Age of the property
• Whether it is a house or apartment
• Size of the property
• Whether the property is furnished or not
• Amenities
• Condition of the property
• Quality of the building
• Whether the building has an elevator or not
• Whether the property has a garage or parking spaces
• Lot size of the property

There are a few ways to determine the average prices of properties according to your needs. First, you can contact a real estate agency. They can inform you of the realistic price for a property according to your requirements.

The second method is to poke around on Njuškalo.hr to see the types of properties that are currently available. These prices can be a little less reliable as they have been known to be a little higher than what the owners will actually take (in some cases). Njuškalo is the biggest Croatian advertising web site.

[Read: An English guide to Njuškalo (Croatia’s Craigslist)]

For the latest average property prices in Croatia’s biggest cities, along with a guide on how far your money will go, check out our post here.

Note: To buy a property in Croatia, you do not have to open a Croatian bank account, but you must have Croatian OIB.

[Read: How to Get an OIB Croatian Identification Number]

When paying from outside of Croatia, you will need additional payment information, such as a SWIFT code. Contact Porezna uprava (Tax Administration) according to the location of a property, and they will provide you with the SWIFT code and other important information.

A list of Tax Administration offices in Croatia is available here.

#2 Down payment

If you plan to get a mortgage in Croatia, it is important to understand how much a bank may fund for the purchase. Most Croatian banks will only fund 75% of the cost of the property. This means you will need to pay 25% of the property cost in cash or funded in some other way, which serves as a down payment.

If you are a foreigner, there are restrictions to getting mortgages in Croatia. You can learn about getting a mortgage loan here.

[Read: Croatia’s banks that offer mortgages and who they will consider for a loan]

#3 Deposit

When buying a property, a pre-contract between a seller and a buyer may be concluded. In addition to defining key information about the property, this pre-contract also defines the amount of the deposit called kapara. The deposit secures the property, but also can act as a type of severance pay.

If the buyer backs out of the purchase or doesn’t meet the pre-contract terms, they will lose this deposit with no chance of a refund. If the seller backs out or violates the pre-contract terms, they must pay double the amount of the deposit to the buyer. The usual amount of the deposit is 10% of the property sales price.

This deposit is part of the 25% of the property cost you would need to pay in cash.

#4 Real estate agency fees

Hiring a real estate agency can be helpful as they know the area, can negotiate with the owner on your behalf, and take care of the bulk of the buying process. This can make buying a property faster and easier.

Many agencies charge a fee only to the seller of the property, meaning the buyers are exempt from paying agency fees. However, other agencies charge this agency fee to the buyer.

When hiring an agency, fees will usually vary between 2% to 4% of the agreed property purchase price. PDV (VAT) of 25% will also be charged on top of this agency fee. Agencies usually define a minimum fee, which can also vary. For example, for some agencies, the lowest fee is 2.500 € and 4.000 € for others.

Agencies define their terms, conditions, and fees in their mediation agreements which are determined between the agency and the buyer. Fees will usually be charged after signing the purchase pre-contract or contract.

Make sure you know what a real estate agency charges before formally engaging with them.

#5 Lawyer fees

Using a lawyer is absolutely critical when purchasing a property. There are so many ways a buyer can get screwed over in Croatia when it comes to property, and it can take years, sometimes decades, to resolve in court. This is a risk for all buyers, not just foreign buyers. Anything to do with property in Croatia should be taken very seriously.

Lawyer services may include:

• Checking the ownership of a property
• Researching a property to see if the title is clean
• Cleaning a title
• Checking the legality of property and sale
• Writing a purchase pre-contract
• Writing a purchase contract
• Submitting the request to the Ministry of Justice (for purchases by foreigners)
• Submitting the request to the land registry office for a change of ownership

To get an idea of what the process looks like for buying real estate, check out our detailed guide here.

The fees that a lawyer may charge for their services when buying a property can vary. Some charge a flat rate for specific services, and some charge a certain percentage of the property. Those that charge based on a percentage usually always have a minimum fee. If the lawyer is in the PDV system, they will charge 25% PDV on top of any service fee.

When talking about bigger transactions, sometimes it is more cost-effective to hire a lawyer who charges by the hour. However, it all depends on the individual case.

It is good to know that some real estate agencies cover the lawyer’s fees using their agent fee. That is usually the case when the legal work is done in-house. So, if the agency has an in-house lawyer, the cost will usually be included in the agency fee.

Many real estate agencies have lawyers that they work with regularly. However, those lawyers are usually advocates for the agency and the seller, not the buyer. If you are purchasing a property in Croatia, it is vital that you have your own lawyer to advocate for your interests. We can connect you to a vetted property lawyer who can assist you with your purchase or sale. To request a referral, click here.

#6 Evaluation of the property

Evaluation of the property is a service that is usually performed by the bank when requesting a housing loan. It is called procjena vrijednosti nekretnine in Croatian. This service will ensure that the property for which the loan is approved is more valuable than the amount of the loan itself.

Most Croatian banks will perform this service free of charge. However, if they ask you to pay for this service, the approximate price will vary. A typical price for the evaluation of a property up to 90 square meters is 170 euros.

[Read: Croatia’s biggest banks: 2022 Comparison of fees and services]

#7 Fees at notary public

When buying a property, you can’t avoid fees from the notary public regardless of whether you are using a housing loan or not. During the buying process, you will need a purchase contract at a minimum, but the best is to have both a pre-contract and a full purchase contract.

A purchase pre-contract must be verified by a notary public. By verifying it, the authenticity of the contract is confirmed.

Multiple copies of the purchase contracts must be printed and verified. You’ll need a copy for the:

• Seller
• Buyer
• Notary public
• Ministry of Justice (if you are a foreigner)
• Land registry department of the municipality court
• Tax administration
• Bank (if you are using a loan)

The price of verifying the original contract is ~5 euro. The price of verifying each copy of the contract is ~3 euro.

[Read: How to get something notarized]

When you use a housing loan

When using a housing loan from banks to purchase real estate in Croatia, there is one additional cost.

In addition to the verification of the purchase pre-contract and purchase contract, the loan contract must go through a procedure called solemnizacija (solemnization). This is also done by the notary public. It includes verification of the contract and clarification of all legal consequences of the contracted work.

Solemnization of the contract is a complex procedure, so the price is higher than the verification price. The price depends on the amount of the loan.

Below are some examples and approximate prices:

• Loan amount of 16.000 euro – 90 euro
• Loan amount of 50.000 € – 265 euro
• Loan amount of 100.000 € – 530 euro
• Loan amount of 150.000 € – 665 euro

Additional costs that may appear when taking a loan from the bank are signing a promissory note and verification of the seizure statement. The bank will ask you to verify these at the notary public. These costs can’t be avoided if you are buying a property using a mortgage loan from a bank in Croatia.

View our guide to the biggest banks and their services in Croatia here.

When you don’t use a loan

If you are not obtaining a bank loan in Croatia, you do not have to go through the solemnization step. You will still have to obtain notarized copies of your contracts per the list at the beginning of this section.

#8 Official court translator

Any non-Croatian citizen must have an official court translator present at the notary public. This is a legal requirement to ensure you understand what you are signing.

They will go through all of the documents with you and explain what they say in your native language. This cost can vary a little but is usually about 200 to 330 euro.

#9 Property transfer tax

Whenever a property transfers ownership, the new owner must pay a property transfer tax called porez na promet nekretnina if the seller already didn’t pay PDV on the property. This is mandatory for all property owners regardless of how the property was acquired (purchase, inheritance, etc.). The tax rate is 3% of the market value of the property at the time of its acquisition.

Sellers who are registered to the PDV register must pay PDV in only two scenarios:

• They sell, give or transfer ownership on building lands
• They sell, give or transfer ownership on buildings or their parts and the land on which they were built if these buildings or their parts were inhabited or used for less than 2 years

However, some groups are exempt from the property transfer tax.

These are:

• Protected tenants who buy residential buildings or apartments in which they live on the basis of a rental contract
• Citizens who buy residential buildings or apartments (including land) on which they had occupancy rights or with the consent of the occupancy right holder according to regulations that define selling of apartments that have occupancy rights. The same applies to protected tenants who buy residential buildings or apartments in which they live on the basis of a rental contract

Property transfer tax incurred after January 1, 2017 must be reported by:

• Notary public
• Court
• Competent public legal bodies

After verifying the purchase contract at the notary public, the notary will send the contract to the Tax Administration. Porezna uprava will then bring a temporary solution or a permanent solution (called a Rješenje o utvrđivanju poreza na promet nekretnina) on the property transfer tax.

If you received a permanent solution and paid the tax, you are safe. However, if you received a temporary solution, the tax administration has the right to recalculate the tax during the next 6 years if they conclude that this is necessary. They may determine that the purchase price deviated from the market value of the property at the time of the purchase, hence, the tax amount must be adjusted.

Sometimes the property transfer tax isn’t reported according to the market value of the property. People usually report lower amounts. In this scenario, Porezna uprava will evaluate the property in the next 6 years after delivering a temporary solution to determine its true market value. After confirming the real market value, they will send a permanent solution to the owner. The owner will then have to pay for the tax difference.

If the owner is exempt from paying the property tax, they won’t receive a solution for the exemption.

The deadline for paying the property transfer tax is 15 days after the solution was received. An appeal won’t delay the execution of a temporary or permanent solution.

Furthermore, if the purchase contract wasn’t verified by a notary public, this doesn’t mean that the property transfer tax doesn’t have to be paid. Cases like this must be reported to the Porezna uprava office nearest to the location of the property. The deadline is 30 days after the contract was signed.

#10 Renovation costs

When you decide to buy a property, you may already know that you want to renovate it to suit your tastes. On the other hand, some properties in Croatia need a full renovation. Some properties are stone ruins, in which case they basically need to be rebuilt from the ground up.

If you are not familiar with the construction and renovation industry in Croatia, we will give you the headlines. This topic warrants its own novel on its own, which we will chip away at bit by bit.

When you want to renovate or rebuild, there will be permits, material costs, and labor costs. Whatever you think it might cost, triple it. Whatever time you think it might take, triple it.

All this must be taken into consideration if you are planning to buy something that needs work, regardless of what work that may be.

#11 Moving costs

If you’ve just landed in Croatia and do not have many things, then perhaps you can just rent a car and move over your things piecemeal. However, if you have a life here already or you’ve imported your belongings overseas, a moving company is probably a better option.

Moving costs vary depending on the moving company and the city to which you are moving. If you hire a 3-hour moving service that includes 4 workers who will help with the moving and a truck size of up to 36 cubic meters, the approximate cost will be 200 euro.

If you need boxes, tape, and other packing material, those can usually be obtained by the moving company and delivered to your address in advance. The approximate cost of one box is 2 to 3 euro. You can avoid this cost if you ask your supermarket or local shops for empty boxes.

#12 Insurance

If you want to protect your property from unexpected accidents, the best thing you can do is to insure it. The insurance may cover the damage caused by burglaries, earthquakes, fires, floods, and any other bad weather.

You can insure the summer kitchen, garden, storage, swimming pool, auxiliary fence, solarium, and all other construction parts of the house. In addition, you can insure furniture and household members.

Conclusion

Be sure to take all of these costs into account when searching for real estate to buy in Croatia. In a future post, we will address the costs associated with owning a property in Croatia.

Need help buying real estate in Croatia?

If you need help purchasing a property, we can help! We have carefully vetted a network of real estate lawyers who can help you buy real estate in Croatia safely with confidence. Buying property in Croatia can get sticky, so it is vital that you have a skilled advocate who is looking after your interests.

Real estate agents usually have an existing network of lawyers that they work with, however, those lawyers are focused on the interests of the real estate agency first,  and the seller second. As the buyer, it’s imperative to have your own lawyer to protect your interests.

Our vetted property lawyers can:

• Answer all of your property questions
• Find property records
• Clean property titles
• Help you purchase a property and represent you during the process
• Ensure you are not taken advantage of by property sellers
• Prepare and review contracts
• Help you sell a property
• Engage local contractors and interior designers

To get help from a vetted real estate lawyer, please share your needs with us using the below form. Based on those needs, we’ll match you with the right person best suited to help.

Check out our other property posts

• Guide on how to get a residence permit based on property
• How to buy residential real estate in Croatia
• How to find property ownership records in Croatia
• How to get a mortgage loan in Croatia
• How to create a legally binding contract
• Residential property prices in Croatia’s biggest cities
• Things to know about getting a mortgage

Sources:
Porez na promet nekretnina by e-Građani
Skrivene naknade by Dora Koretić
Troškovi kupnje nekretnine u Hrvatskoj by Right Property Croatia
Troškovi kupnje nekretnine u Hrvatskoj by First Property Croatia
Trikovi poreznika by Dora Koretić
Osiguranje kuće ili stana by moj-bankar.hr