FAQ

Frequently asked questions

1Who can buy property in Croatia?
Citizens of EU Member States - from 01.February.2009.

For citizens or legal persons who are not members of the European Union, the rule of reciprocity applies - if Croatian citizens can buy in that country, then the citizens of those countries can buy in Croatia. Here are some countries that have reciprocity, for the full list or additional questions contact us:

Argentina
Australia
Belarus
Bosna and Hercegovina
Brasil
Canada
Chile
Iraq
Iran
Israel
Japan
Kazakhstan
Kosovo
Lebanon
Lichtenstein
Makedonia
Malezia
Moldova
Montenegro
New Zeland
Norway
Panama
Paraguay
Russia
SAD
South Africa Republic
South Korea
Serbia
Switzerland
Turkey
Ukraine
2Costs & Fees
Real Estate Agent´s Fee 3% + PDV (tax) =3.75% - Paid by buyer

Real estate transfer tax: 3% - Paid by buyer

Exceptions

a) In a situation where the company buys real estate which is built and solely registered on the company, there is no transfer tax.

Example - Foreign company buying hotel business or villa built with the intention for sale, for which purposes the company is made and/or operating.

b) If the building is newly built, under 2 years, then there is no transfer tax and the VAT is included in the price. Lawyer fee - 0% - We have the lawyer in our team

Permission from the Ministry of Justice, the Notary’s Office fee and that of the translator and the fee charged by the Land Registrar - total up to 500 euros
3Acquisition process
1. Pre-contract agreement can be made if the buyer and seller agree on it, but if not they can go straight to signing the main contract. However, if they are singing pre-contract buyer is expected to pay a down payment of the equivalent of 10%-15%. Pre-contract contains all necessary conditions as the main contact, but by signing it binds the property, reserved for the buyer for the agreed time period until all agreed tasks are resolved so the main contract can be signed.
2. The buyer then should apply for the consent from the Ministry of Foreign Affairs. Necessary documents include:

a) The purchase agreement
b) The proof of ownership (seller)
c) Confirmation that the property is within the construction zone envisaged by the zoning plan
d) Proof of citizenship - buyer
e) Proof of citizenship - seller

3. The contract is then prepared by a lawyer and signed by the notary office. An official note of the contract should be made in the Land Registry. Once the Ministry of foreign affairs consent is granted, the contract needs to be registered in the Municipal Cadastral Department´s Land Books, and the purchase tax needs to be paid.
4Skipping the pre-contract?
Pre-Contract can be avoided, only the Final Contract is signed in that case, it depends on the real estate status and things to be settled before concluding the main contract. If the buying process is simple and the buyer is prepared for the transaction of the funds, then there is no need to do Pre-contract. Pre-contract is useful is to prevent the property to be sold to another buyer, it is a good way for buyer and seller to oblige each other to buy/sell the property and to agree on the fixed price that cannot be changed afterward.
5What is the Notary Office
The Notary Public is a qualified solicitor working for the Croatian Government. They ensure that all the documents involved in the property transaction are valid, legal and binding. Specifically, it is a requirement within Croatian Property law that the Notary Public witnesses the signatures on the Final Contract – without this witnessing stage the Final Contract is not legally binding. Also, the Notary Public will certify that any documents that have been translated from a foreign language to Croatian have been prepared by a registered court translator or the solicitor personally – thereby guaranteeing that the translated documents are true and valid. It will notarize signatures of the sellers on the contracts and is registering you as the new owner in land registry court books.
6Financial transfer
Usually, the funds are transferred to the vendor’s account after purchase Contract signed and notarized; the Final Contract is signed; and the Seller signs a confirmation that they have received the funds. This confirmation has to be also notarized (usually at the same time when the main Contract, and Seller holds this confirmation in hand until he receives full amount of the price). Most people quite understandably are uncomfortable with the thought of sending money to someone in a foreign country with no apparent guarantees – in which case an Escrow Service can be used, or other ways of fund transfers which we can explain in due time by mail.
7Escrow services
They are provided by most Notary Publics and by banks. Fees vary, Escrow Services or not, and whether they charge extra for the service, or you can use in some cases bank escrow account to execute the transfer of the funds in the moment when you are registered as new owner of the property in the land registry books/court.
8Bank account in Croatia
For opening a bank account in Croatia you will need your passport to prove your identity and OIB number that every person in Croatia must have (Personal identity tax number), which your solicitor will issue for you at local Tax Administration Office. Maybe the best way is that you open a foreign currency account to handle the transfer of payments for the property transaction as well as a local Kuna account which you will need for smaller expenses once the transaction has completed. Usually price is listed in EUR but paying inside Croatia is made by official currency Croatian kuna.