First Blog
Croatia Second Homes Market In Recovery Mode
Date posted: 09.11.2011.
Since mid-July we have seen a dramatic increase in the amount of interest in property for sale in Croatia, in particular the Northern & Central Dalmatian region. More importantly agents have seen a significant rise, all be it from a small base, in the number of transactions taking place.
The trigger seems to have been the announcement in late June by the European Enlargement Committee that Croatia will join the EU on 1st July 2011. Moreover, it has come at a time when buyer and seller’s price expectations have begun to reach equilibrium. Furthermore feedback from our clients suggests the situation in Europe and instability in the financial markets is making little difference to their appetite to purchase. In fact some are saying it is driving them towards buying a property, as they see it as a safer alternative, at a time when it is hard to know which currency to keep your money in or which bank to bank it with.
With the number of real estate sales in Croatia increasing, price / value information is finally being fed through to the market. Prior to this transaction volumes were so low it was very difficult to get vendor’s to see reason since there was so little comparable data. With transaction volumes on the increase and buyers and sellers expectation now aligning, it would appear we have reached the bottom of the market for Croatian second home purchases.
The types of properties, Croatia property investors are showing interest in are quite typical due to the economic uncertainty. The majority, are looking for waterfront properties or heavy discounts Seaside properties have continued to see strong demand throughout the last 3 years with only a slight reduction in price. Since August 2011, interest in the apartment market has been increasing having been flat for since 2008, as well as the cheaper end of the old stone house / renovation market.
It remains to be seen if this rally will continue but the signs are good. Erste bank have also come to the market this summer with a mortgage product for EU citizens, which is relatively competitive and much more straightforward than previous versions. This will help to continue momentum with foreign buyers and we have had a lot of interest from clients. Several have now been through the process successfully. For more information on the Erste mortgage product in Croatia contact us.
Property Market – Central Dalmatia – Croatia Summer 2011
Date posted: 29.07.2011.
July and August are usually quieter periods for serious property buyers, but this year we have seen a big uplift in verified enquiries. This is much inline with some reports from the larger internet real estate portals who have experienced a significant rise from people looking to buy property in Croatia in the last month. Clearly this has something to do with the recent announcement of Croatia’s entry to the EU in July 2013 which is generating interest across a range of buyers.
The largest number of verified enquiries are looking for properties in Croatia that are next to the sea or very close too it. On average budgets range from 1,000,000 plus for a luxury villa by the sea, 100,000 € to 400,000 € for land, €250,000 to €400,000 for villas & houses and €100,000 to €150,000 for an apartment. Generally speaking it is possible to find something next to the sea or close to it for the above budgets & type, although it is becoming increasingly difficult due to low levels of supply.
Supply of waterfront properties or properties by the sea are low due to high demand, restrictive zoning which has limited the availability of building land and lack of infrastructure in tourist zones on the seaside. The result is prices have remained pretty much constant throughout the financial crisis and are in fact now beginning to rise. This is especially true of land prices, as available plots in good positions that are not blighted are increasingly scarce. Land prices by the seaside in the Central Dalmatian region are going for €250 / m2 up to 500 €/m2 averaging somewhere between €300 & €400 / m2.
For those buyers who are not so concerned about being close to the sea there are some excellent deals available with vendors more willing to negotiate. For these types of properties in Croatia it is definitely a buyers market although with pending EU entry we do not expect this to last for long, probably the next 12 months so now is a very good time to buy.
Have Croatian Property Prices Begun To Stabilize ?
Date posted: 05.04.2011.
It is being reported by a number of websites and commentators that house prices in Croatia have begun to stabilize. There is perhaps some truth in that regarding specific areas or asset classes however the general picture would seem to suggest further falls for Croatian property are likely. Moreover, most of these reports are based on advertised prices, which bear very little resemblance to actual sales values of property in Croatia. Furthermore, some are quoting indexes, but we are not aware of any property indexes in Croatia that are based on reliable sales data, if anyone knows any different please contact us we will be happy to make that data available and reference it.
Why further falls? With political parties beginning to gear up for the election approaching at the end of the year, the chance of any renewed efforts by central government to kick-start the Croatian economy are unlikely. Since existing policy is both uninspiring and lack luster, we do not see any real chance of the Croatian economy making any real gains this year and in fact conditions could continue to get worse.
What has definitely happened is that buyers are now coming into the market as Croatian property prices are more reasonable and there are some good deals around. We can say this is the start of the bottom fishing process. Whether we are actually near the bottom is debate-able, for reasons mentioned above, but for some who have been waiting they feel now is an appropriate time. This is all part of the recovery process, as confidence comes back, and once again buyers and sellers expectations align and deals are made.
But, whilst positive and encouraging, the market is still very fragile. Banks are not lending, unless developers can demonstrate pipeline sales and a strong product. In the current market very few projects meet that criteria excluding those that are in the top A locations. For buyers they are lucky to get 30% LTV if at all, with cases being assessed on an individual basis and interest rates around the 10% mark (extremely high when you consider the current European Union Central Bank rate).
Foreign clients buying property in Croatia, rarely understand the reason for such caution. This is understandable but from the banks perspective what happens if a foreign client stops making repayments. Unless they are in the business of 'loan to own', trying to recover monthly payments on a loan of €100,000 is not cost effective. Moreover, if a repossession order follows, this is currently a time consuming and risky process in Croatia and it therefore does not make good business sense from the bank's perspective. For EU citizens this will change as soon as Croatia joins the EU and will open up the mortgage market. This should have considerable positive impact on the Croatian real estate market.
There are a number of reasons why advertise prices of Croatian property are so high compared to actual sale values, most of which has been dealt with in this article Property In Croatia. However, one factor that has become apparent in recent months is that buyers will often negotiate as hard on a realistic price as they will on an unrealistic price and therefore Vendor’s are reluctant to reduce advertised price at all. This exacerbates the situation, especially in a market that is still in the early stage of development with little comparable data. This is of course with reference to the coastal market that is more orientated to second-home buyer but still has some relevance to domestic market too.
Croatian Real Estate Agent - Croatia Property Enquiries - Part 1
Date posted: 04.03.2011.
You often hear people moaning about real estate agents, getting paid too much and doing very little. So why bother with them? Like any profession there are good and bad apples, but if you get a good one you will never look back. This is especially true when you are buying property in a foreign country, where things are never quite what they seem.
Buying property in Croatia is no different and a good real estate agent in Croatia will both find you the right property as well as assist you through the process, always in conjunction with a good lawyer. So what exactly would your Croatian property agent do? In the first part of this series of articles we talk about our initial introduction to potential clients via ‘leads’ where they come from and at what time of year.
We receive leads from a variety of sources and in varying numbers during different parts of the year. During the winter period we receive most of our leads through our website and Internet partners with whom we co-operate. Currently as we build our online presence we receive about 50% of our leads through www.firstpropertycroatia.com and the rest through partner sites. By partner site we mean Internet portals that promote property in Croatia.
A large majority of the client leads we receive are from people who are at the initial stages of considering purchasing property in Croatia and understandably a very high number perhaps as many as 95% come to nothing. But it is important to respond to all of them, professional and courteously, providing as much relevant information as possible and keeping communication open for as long as necessary.
Of the remaining 5%, the large majority have already committed to buying property in Croatia they just haven’t found the right property yet. Often they have already been to Croatia, looking for Croatian real estate opportunities, and have done some initial research into locations and price as well as viewed some property. With these clients we start to build up a detailed profile to fine tune exactly what they are looking for, helping to crystalize their thoughts regarding the type of property in Croatia they want to buy and therefore which properties would be interesting for them to view. This is an important process since it saves our clients and our time.
During the summer season we continue to receive clients through www.firstpropertycroatia.com but from the beginning of March we start to get referrals via our network as people looking to buy property in Croatia arrive in Croatia and are given our contact through a third party. Third parties are a combination of friends, colleagues working in other real estate related businesses, insurance, banking, property management for example. We also start to receive contact from other agencies we co-operate with and who need help finding the right properties for their clients. However, perhaps most importantly we receive a lot of clients, the vast majority of who are our best clients, through referrals from clients that have previously purchase property in Croatia with us.
Timing wise our good quality Croatian real estate leads tend to come through outside of season, early season or end of season. During the season we have a lot of what we would call ‘site seers’, people who thought it might be a nice idea to own a real estate in Croatia whilst sitting on the beach enjoying their holiday. Rarely do these sorts of client’s progress to purchase a property and since we do not use aggressive sales tactics we do not push clients to buy a property in Croatia they do not want. We very much believe in ‘what goes around comes around’ and prefer to guide clients, providing relevant and detailed information allowing them to make their own decisions. Of course we are a business and therefore have an interest that our clients buy a property in Croatia, but not at any cost. A happy client not only feels good, they are also our best advocates who will refer friends and others in the area in which they have purchased.
In the next article we will talk about the different types of clients that contact us and the process we go through before they come to view properties in Croatia.
Cheap property in Croatia – Real Estate Čiovo
Date posted: 31.01.2011.
Croatian property prices have fallen over the last 24 months, along with most other parts of Europe. Cheap property in Croatia is not restricted to any one specific area, so it is possible to find cheap Croatian property in most places in Croatia. However property is often cheaper in places where there is an over supply and this is the case with the Island Čiovo.
Čiovo is one of the best places to find cheap property in Croatia. It is an Island, connected to the UNESCO town of Trogir in Central Dalmatia. Čiovo property is cheap because there is an over supply of unsold units, in most cases apartments, and developers are offering substantial discounts. In fact Čiovo property prices have fallen by about 30%. Before the financial crisis Ciovo property buyers were paying up to €2500 / m2 for an apartment, where as now apartments for sale in Ciovo are selling for between €1400 / m2 and €1700 / m2 with only the absolutely best located apartments selling for €2000 / m2 and slightly more in a few instances. Investors looking to buy cheap property in Croatia should definitely consider the Island Čiovo as a place to invest and these are the reasons why.
Čiovo is a fantastic place to have a holiday. Island Čiovo features lots of small idyllic old villages and is surrounded by crystal clear blue sea, with a wide selection of beaches, big and small plus small hidden bays ideal for swimming. Okrug gornji is an established area on Čiovo for buyers looking to buy cheap properties in Croatia. It has a good selection of restaurants, beach bars and other tourist facilities (tennis courts, post office, car hire, activity/excursion companies for diving, fishing, climbing, rafting, tennis, and all manner of water sports. There are several large beaches on the water front ideal for swimming for all ages.
Čiovo is easily accessible. Čiovo is connected by a drawbridge to the UNESCO town of Trogir and is only 11km from the airport of Split. The 2nd largest airport in Croatia and supplied by numerous low cost airline carriers from the UK, Europe and around. Furthermore, it is only 24km away from Split and from where ferries can be caught to the north and south of Croatia, as well as Italy. Access is one of the most important aspects when buying real estate and will add value to any cheap property in Croatia by increasing its rental potential.
Čiovo is a very popular and established tourist destination in Croatia and has a 5 month season. Due to its proximity to Trogir, the airport and Split, coupled with its beaches and stunning scenery, Čiovo is one of the most popular and established tourist areas in Central Dalmatia, with people from both old and new Europe visiting. The season in Čiovo starts after Easter and lasts until the middle of October. The busiest months are July and August. This make Čiovo a great place to own cheap property Croatia as it gives Čiovo property buyers the opportunity to rent their properties, generate a return and still have the possibility to use it.
For investors looking to buy cheap property Croatia, the proximity of both Trogir and Split makes it an especially attractive opportunity. Island Čiovo is in fact directly connected to UNESCO site of world heritage Trogir. Trogir is a fantastic old town and is very popular with Čiovo real estate buyers. It features a beautiful promenade, numerous restaurants; bar’s and is a lively place during the summer season. Trogir is also a port and has ferry connections to surrounding island’s as well as day excursions to remote beaches. Trogir is also only 45 minutes by car from the National park Krka. To get to Krka, you drive to picturesque waterside village called Skradin and then a boat up the river to the park and waterfalls.
Split, the second largest city in Croatia, is only 24km away and is the largest on the Adriatic coast. Split, is the economic, administrative, educational, sport and tourist centre of Split Dalmatia County. Moreover, it is home to the Diocletian’s palace, also UNESCO protected and acts as the main connection point for to reach the central Dalmatian islands of Hvar, Vis, Brac and Solta. It is 3hrs and 30 minutes drive to the Capital Zagreb. Split has a lively but civilized nightlife, with a good selection of clubs and bars. Buyers looking for cheap property in Croatia, are unlikely to find cheap property in Split or Trogir where property prices are more expensive than Čiovo.
Čiovo benefits from some of the best weather in Europe. The weather is excellent it rarely gets too hot and there is always plenty of sun with 2620 sunny hours per year. Average air temperatures January 7,8 °C and / August 25,4 °C. Maximum air temperatures January 17,4 °C / August 38,1 °C. Average sea temperatures January 11,5 °C / August 23,5 °C.
In summary, if you want to buy cheap properties in Croatia, Čiovo real estate is both an excellent lifestyle and investment choice all factors considered. It is a solid medium to long term Croatian property investment opportunity. Čiovo is an established tourist destination with plenty of things to do and see. The area has an established holiday lettings market and a 5 month season with solid rental yields. It is also a good weekend break destination outside of the summer season due to excellent transport connections and proximity to the old towns of Trogir & Split. Moreover, the shipyard in Trogir has been put up for tender and will be turned into a luxury yacht marina, 5 star hotels, and private residents with a water side shopping centre.
Property In Croatia – Croatian Real Estate In 2011
Date posted: 31.01.2011.
2011 looks like a it could be a slightly better year than 2010 for the Croatian property market. Whilst the economic situation in Europe faces further uncertainty due to sovereign debt issues, the negative reporting of financial collapse and economic catastrophy seems to have past us. The result is private investors / buyers are returning to the Croatian property market looking for properties in A locations, sensibly priced and relatively inexpensive holiday apartments near the sea or character properties in Croatia, especially those in the heart of Croatian coastal towns.
Properties in Croatia that are next to the sea are selling well and for respectable prices, meaning not too far off peak, perhaps 5% to 10% maximum. Apartments around the €100,000 mark and not too far from the sea are also selling, largely on the mainland and in more typical locations such as Ciovo, near Trogir. This is due to an over supply of apartments and therefore apartment are more heavily discounted and more attractive to potential property buyers. In Split, there a consistent number of enquiries for property in Split old town, as people look for a holiday home and / or investment property. As prices have come down some 20% from peak, Split real estate is now looking more affordable and yields are looking very good.
Croatian property enquiries for the winter period of 2010 to 2011 are up from the previous year. They are still far from pre crisis levels but a significant rise never the less. Transaction volumes are still low but the number of sales converted is rising and investors who have been showing interest over the last 12 months are beginning to commit. With improving economic conditions globally and a signs that confidence is returning in Europe, all be it slowly and cautiously, it would seem that the trend should continue in 2011.
One thing’s for sure, Croatian real estate agents are really working for their commission. This is no bad thing. It has reduced the number of players in the market considerably. It has also raised the standards as buyers ask considerably more questions, and in general look much more closely at value. This has forced Croatian real estate agents to be more competent, informed and armed with reasoned arguments rather than the standard sales patter. It has also helped to regulate the Croatian property market a little better as prices paid are realistic. There are no men with black brief cases lurking round the corner ready to pay 5 times more than the property is actually worth. Those times are well behind us and thankfully so.
Price wise, regardless of reports of falls of between 5% & 10%, in reality Croatian property prices have fallen more like 20% to 30%. The reason for the disparity is due to advertised and actual sales values. This is especially true for properties in Croatia coastal locations where much of the property is purchased by foreigners and where transaction volumes are so low that data is limited, so much so it is difficult to quantify. Furthermore the current system of monitoring Croatian real estate prices is fairly ineffective due to a lack of accurate data. The main source of data is that of the tax office, where contractual prices of Croatian property sold are registered. However, the practice of manipulating contractual prices for tax purposes is still common in Croatia making available data unreliable.
In the coastal locations, foreign property owners are much more inclined to drop prices. Many of them have experience similar price drops in their domestic markets and have quickly become accustomed to the idea that property is worth less than it used to be and that prices are relative. For example a significant number of foreign owners have sold property in Croatia, to take advantage of falling prices at home, preferring to reinvest locally. We see this trend continuing throughout 2011.
When considering the Croatian real estate market direction for 2011, it is also important to look at Croatia’s economic and political situation. Currently Croatia is going through its own crisis of confidence, not least with the economy. However, considering the state of many of the other peripheral European economies as well as it’s comparative size, Croatia is not alone. It is certainly no worse than Greece, Ireland, Portugal, Spain and possibly Belgium and is probably better in many instances. The country certainly hasn’t been bailed out by the European Union or International Monetary Fund yet Moreover, as the EU is attempting to introduce a more strategic and coordinated economic policy approach, Croatia, soon to be a member, should benefit.
Furthermore Croatia is tackling the issue of corruption head on. There have been numerous high profile arrests including the arrest of Ivo Sanader the former prime minister, as well as a number of his ex ministers and it looks like this is just the start. With the press now having free reign in the democratic process stories of new government officials and their unexplainable wealth are hitting the headlines on a regular basis. It would seem that Croatia is somewhat unique with regard to its open attempts to tackle corruption. Born by it’s need and drive to join the European Union Croatia, unlike Rumania and Bulgaria, as well as some of the more established countries of the EU, has had to be brave and deal with this difficult problem upfront of Croatia EU Accession.
This has understandably caused some negative sentiment from foreign investors short term. But then investors are being cautious for the same reasons they are cautious pretty much everywhere in Europe at the moment. We only really see this changing once the banks begin to lend again bringing with it a change in sentiment. This is especially the case for the second homes market. However, medium to long-term, and more specifically after Croatia joins the EU end of 2012, things are sure to improve.
How does this affect the Croatia property market? Short term we expect there to be continued downward pressure on real estate prices in Croatia, however transaction volumes are rising as buyers and investors look to take advantage of bargains as well as some solid Croatian property investment opportunities. Medium term we expect to finally see Croatia join the EU, but it remains to be seen how much of an effect on Croatian real estate prices it will have. There are two distinct possibilities, a moderate and stable effect or an inflationary drive. It will largely depend on the EU itself and whether it is able to resolve it’s own issues and repair confidence in its ability to manage and unify it’s members on the necessary financial regulation so as to prevent the same sovereign debt issues some of it’s members are currently facing, and more importantly the impact that has on it’s other members and the EU itself.
Realistically, it is likely to be somewhere in the middle and in which case we don’t expect to see the same Croatian property price inflation post EU Accession as those of the countries that joined in 2004, but we do expect to see confidence returning and expect moderate but stable price rises. If the alternative scenario where to be true, we could expect excitement and interest as Croatian property prices will be bottoming out, EU regulation will have been implemented, there will be ongoing economic and judicial reform and the government should have a better handle on corruption. In this instance we could see some significant price inflation, especially in the A locations for real estate in Croatia. This does however assume that the banks are willing to lend.
Buying Croatian Property In A Culturally Protected Area
Date posted: 23.03.2010.
There is one other very important piece of information that one must be aware of when purchasing Croatian property that is located in a culturally protected area. As a buyer you do not have the right to purchase the property until it has been offered for purchase to the local council, county council and Republic of Croatia. The law states that each institution must confirm its intention to purchase within 60 days from receipt of the vendor's confirmation that the property is for sale. If none of the institutions correspond within the given period then they automatically forfeit their right to purchase and you can legally buy the property.
In most cases a pre contract is signed with a deposit paid onto an approved third parties account with completion 14 days after having received confirmation from all three institutions that they do not intend to purchase or after the 60 day period has passed, whichever is sooner. Please note whilst this is a necessary process, it is extremely rare for any of the institutions to take up the offer to purchase Croatian properties in culturally protected areas. They do not have need or the means to do so. However, the procedure must be followed since failiure to do so can result in the Croatian property purchase contract being cancelled with you left responsible for getting your money back from the vendor.
Cultural Heritage & Your Croatian Property Planning Application
Date posted: 24.02.2010.
If you buy a property in Croatia that is in an area that is under the protection of the Cultural Heritage and you intend to renovate the house or make exterior changes to it, you must seek permission from the county Cultural Heritage department as part of the Croatian planning application process.
Many old towns in Croatia are protected and in some cases individual properties, with different rules applying to both. Clearly protected Croatian property comes under closer scrutiny than Croatian properties that are not directly protected but are located in a culturally protected area. The purpose of this article is to outline the procedure relating to property in Croatia that is not directly protected but located in a protected area. Furthermore for the purposes of this article we will assume the county in question is Split Dalmatia.
So when is it necessary to seek permission from the Split Dalmatia County Cultural Heritage Department ? Generally speaking if you buy a property in Croatia or more specifically a property in Split and it is in a protected zone and you intend to renovate it and in doing so make changes to the interior, be that knock down walls, put in new electrics, plumbing, sanitary equipment, windows or do anything else to the property that constitutes a change to the existing structure, you are supposed to get the permission of the Split Dalmatia Culture Heritage Department.
Some people don't but for foreigners buying property in Croatia it is highly advisable to do so. In fact in not doing so you are potentially breaking the law. For some reason when foreigners buy property in Croatia they sometime leave their common sense at home. The question to ask yourself is how would i approach this if i was at home ? For anyone from a western european country the answer is to follow the appropriate rules and regulations and employ the necessary professionals to help you do so. But for some reason some people seem to think that small changes to a property in Croatia will go unnoticed and having bought their dream home in Croatia can't live with the idea that in fact what they thought they could do or in lots of cases were told by their agent they could do, might now not be able too.
However, in not following the necessary procedure you are leaving yourself open to a lot of hassle & unecessary cost, and in some cases possible prosecution. This is especially true of the Croatian island property where small communities are prone to gossip especially during the winter period and it is highly likely you would get a visit from one of the relevant authorities be that the Split Cultural Heritage Department or the building inspector during the construction process. If you cannot provide the necessary documentation to validate the works being undertaken they can shut down the site with immediate effect. They will then ask you to either legalise the works prior to starting again or knock down and remove what you have done so far, if legalisation is not possible. To legalise the building works you will need permission from Split Cultural Heritage Department, as well as the local Croatian planning office.
So at what point do you apply for permission from the Split Cultural Heritage Department ? This is always done at the beginning of the process by your architect who supplyies the relevant department officer for the area in which your Split property is located with your intended project. If you are doing basic renovation and modernisation to your Split property, which includes rearranging the interior of the object, knocking through walls, putting in new bathrooms, new joinery, electrics, plumbing etc then it is, in most cases, not necessary to contact them prior to submitting the project. However, if you intend to do anything that constitues a change to the existing structure with particular regard to the buildings outside appearance then it is essential they are contacted and consulted prior to submitting the Croatian planning application.
The sort of things that area deemed to be contentious when reconstructing your property in Croatia are; raising floors, opening new windows or doors, lifting the roof, demolishing existing walls & swimming pools. There are others but these are the most common. It is always best to ask your Croatian architect to have a preliminary discussion with the Split Cultural Heritage Department during the initial design phase. This should save you time and money. If they raise objections you are then able to negotiate, trying to find some middle ground, with your architect producing creative solutions to their objections. This can take a little time but is the most agreeable path. Having said that do not expect any major deviations in your favor, the rules & regulations are strict and it is unusual to get away with anything that could be deemed to be out of the norm. One things for sure there is very little point submitting the application and hoping for the best.
How important is the Split Cultural Heritage Department to my Croatian property planning application ? They are extremely important since the planning office is very unlikley to approve an planning application without the permission of the Split Cultural Heritage Department. In fact, for applications in relation to the reconstruction of old stone houses located in protected areas, their approval is tentamount to being given permission to build. Of course the subsequent planning application must be made to the relevant Croatian planning authorites. Moreover, all the necessary and valid documentation relating to your property in Croatia must be provided. Also, it is important to understand the situation regarding your neighbors who do have the right to object, although they must have valid grounds in order to do so. However, assuming the documentation is in order and there are no complaints from the neighbors then your application should be processed without delay.
So when is it necessary to seek permission from the Split Dalmatia County Cultural Heritage Department ? Generally speaking if you buy a property in Croatia or more specifically a property in Split and it is in a protected zone and you intend to renovate it and in doing so make changes to the interior, be that knock down walls, put in new electrics, plumbing, sanitary equipment, windows or do anything else to the property that constitutes a change to the existing structure, you are supposed to get the permission of the Split Dalmatia Culture Heritage Department.
Some people don't but for foreigners buying property in Croatia it is highly advisable to do so. In fact in not doing so you are potentially breaking the law. For some reason when foreigners buy property in Croatia they sometime leave their common sense at home. The question to ask yourself is how would i approach this if i was at home ? For anyone from a western european country the answer is to follow the appropriate rules and regulations and employ the necessary professionals to help you do so. But for some reason some people seem to think that small changes to a property in Croatia will go unnoticed and having bought their dream home in Croatia can't live with the idea that in fact what they thought they could do or in lots of cases were told by their agent they could do, might now not be able too.
However, in not following the necessary procedure you are leaving yourself open to a lot of hassle & unecessary cost, and in some cases possible prosecution. This is especially true of the Croatian island property where small communities are prone to gossip especially during the winter period and it is highly likely you would get a visit from one of the relevant authorities be that the Split Cultural Heritage Department or the building inspector during the construction process. If you cannot provide the necessary documentation to validate the works being undertaken they can shut down the site with immediate effect. They will then ask you to either legalise the works prior to starting again or knock down and remove what you have done so far, if legalisation is not possible. To legalise the building works you will need permission from Split Cultural Heritage Department, as well as the local Croatian planning office.
So at what point do you apply for permission from the Split Cultural Heritage Department ? This is always done at the beginning of the process by your architect who supplyies the relevant department officer for the area in which your Split property is located with your intended project. If you are doing basic renovation and modernisation to your Split property, which includes rearranging the interior of the object, knocking through walls, putting in new bathrooms, new joinery, electrics, plumbing etc then it is, in most cases, not necessary to contact them prior to submitting the project. However, if you intend to do anything that constitues a change to the existing structure with particular regard to the buildings outside appearance then it is essential they are contacted and consulted prior to submitting the Croatian planning application.
The sort of things that area deemed to be contentious when reconstructing your property in Croatia are; raising floors, opening new windows or doors, lifting the roof, demolishing existing walls & swimming pools. There are others but these are the most common. It is always best to ask your Croatian architect to have a preliminary discussion with the Split Cultural Heritage Department during the initial design phase. This should save you time and money. If they raise objections you are then able to negotiate, trying to find some middle ground, with your architect producing creative solutions to their objections. This can take a little time but is the most agreeable path. Having said that do not expect any major deviations in your favor, the rules & regulations are strict and it is unusual to get away with anything that could be deemed to be out of the norm. One things for sure there is very little point submitting the application and hoping for the best.
How important is the Split Cultural Heritage Department to my Croatian property planning application ? They are extremely important since the planning office is very unlikley to approve an planning application without the permission of the Split Cultural Heritage Department. In fact, for applications in relation to the reconstruction of old stone houses located in protected areas, their approval is tentamount to being given permission to build. Of course the subsequent planning application must be made to the relevant Croatian planning authorites. Moreover, all the necessary and valid documentation relating to your property in Croatia must be provided. Also, it is important to understand the situation regarding your neighbors who do have the right to object, although they must have valid grounds in order to do so. However, assuming the documentation is in order and there are no complaints from the neighbors then your application should be processed without delay.
How long does it take the Split Cultural Heritage Department to give their approval ? In general, although it does depend on the complexity of the case, they give their approval within 30 days. If they have been consulted prior to the application being made and any necessary changes made to the project in accordance with their wishes, then there is very little reason to slow the process down. It is a simple case of them issuing the necessary approval document.
What are the chances of having your application rejected by Split Cultural Heritage Department? For basic renovation of your property in Croatia with only interior changes the chances are very small. If you are making changes to the exterior this is a different matter. As mentioned previously to avoid problems it is always best to consult with Split Cultural Heritage Office prior to putting in your application. In fact if you are buying a property in Croatia that is in a culturally protected area and your property purchase is dependent on being able to make changes to the exterior, it is a very good idea to get your Croatian real estate agent to put you in contact with a Croatian architect who could make some preliminary enquiries. Clearly it is not necessarily something a real estate agent will want to be exposed to since it could affect their sale. However, unless you have an initial opinion you are open to possible limitations regarding the redevelopment of the property which could affect both your possible enjoyment of it and ultimately your purchase decision.
In summary there is no hard and fast rule regarding the process of obtaining Croatian Cultural Heritage approval for your planning application to renovate or reconstruct your Croatian property situated inside a protected zone. The key is to do your research, ask questions and make sure that if the real estate is in a culturally protected zone, that you make contact with the relevant cultural heritage office to speak to a representative before you make your purchase decision.
Split Property - The Price Of Split Real Estate
Date posted: 20.01.2010.
As a general guide the price of Split property in the old town is on average somewhere between €2000 to €3000 per m2 for a period stone property depending on location and condition. However, 99% of Split real estate located in the old town require complete renovation of the interior, most need exterior touching up and a few need structural work to be carried out. Moreover, due to the location of the property in Split old town most of them are under cultural heritage protection. The Split Cultural Heritage Department must be consulted and give permission if you intend to renovate, even if you only want to restore the property without making any changes to the exterior.
It is important to consider the cost of renovating your old stone character Split property when making plans to purchase. For arguments sake the renovation will usually require the following but is not limited to; new electrical and water installations; joinery; tiling; plastering and painting. Moreover for the purposes of establishing a comparative price we will assume a standard kitchen is put in. However, furniture is excluded and we are assuming there are no structural works or works to the roof required. With this in mind you are looking at €350 per m2 for a standard finish, €500 per m2 for a quality western standard finish (4 stars) and upwards for anything better. Obviously it all depends on materials and equipment you want to use to renovate your old stone property in Split, so these prices are only a guide.
In addition to the construction price, it is important that you make an allowance in the budget for the management of your Split property project. This assumes you are not prepared to oversee the works and get the necessary permissions from the relevant authorities yourself. When hiring a project manager ideally you need someone who can be your construction supervisor and your project coordinator. It is important to note that the co-ordination aspect is often overlooked by foreign buyers who will be managing the project remotely. The coordination can take considerable time and effort when liaising with someone abroad via phone & email, if mistakes are to be avoided. It is also vital you have someone who really knows what they are doing in relation to the construction management and it is advisable to make sure they are certified by the relevant Croatian chamber, be it an architect or engineer.
There are other possible costs too, notably an architect should the buyer wish to have plans drawn up and a land surveyor who must validate the size and position of the property with the cadastral office prior to it being sent to the Department of Culture Heritage in Split and then the planning office. If we assume the apartment in question is 100m2, fees could end up around €150 per m2 for a decent land surveyor, architect and qualified project manager / coordinator.
So let us say you find your Split property for €2500 / m2 and it needs renovation but no structural works. For this price one would expect to find a Split propertyin the old town or very close to it. But you will need to be persistent to get something decent for that price. Furthermore let us assume it is 100m2 and you are renovating it to a good standard or 4 star equivalent. Therefore it would cost €500 per m2 for the renovation, plus the VAT which is €115 per m2 (23%), add on your fees of 150 €/m2 gives you €765 per m2 plus the cost of the object at €2500 per m2, which gives a price of €3265 per m2 for a completed object. You then need to furnish your 100m2 Split apartment, and to do so to a good specification you will need to spend €20,000 upwards. If we assume you spend €20,000, this equates to €200 per m2 for our 100m2 apartment. Add this to our existing €3265 per m2 and you end up at €3465 per m2.
So to summarize to purchase a Split property in the old town you will need to spend between €2200 & €3000 per m2 dependent on location and condition, but you should assume it will need complete renovation as a minimum for this price. You will then need to spend €800 per m2 upwards to renovate it to a good standard which includes the cost of construction & professional fees. Furthermore, for a 100m2 you will need a minimum of €200 per m2 to furnish it. Therefore to renovate and furnish your Split property you are looking at €1000 / m2. If you add this to the initial purchase price, you are looking at between €3200 and €4000 per m2 for a well renovated Split property in a good location either inside the Diocletian Palace or close to it.
It is important to note purchase prices can vary wildly, in particular offer prices verses actual prices paid. Properties in Split old town are no different. This article is purely intended as a guide and a possible starting point for people looking to buy property in Split. Obviously, it is essential if you do intend to buy property in Split you do your research before making any financial commitment.
Why Invest In Property In Croatia 2010
Date posted: 18.11.2009.
Croatia has a tranquil beauty rarely found elsewhere in Europe today. A unique combination of beauty & style creating an intoxicating mix that is hard to beat. The countries stunning natural beauty, largely un-spoilt natural habitats, more than 1500 islands and 5835km of coastline make it a heavenly place to visit or stay.
Many of those who purchase property in Croatia are seeking a so called lifestyle home abroad. They are typically looking for a holiday home that doubles up as an investment and they are lured to coastal living. They have been encouraged by their own experience as a tourist in Croatia, enjoying the rich diversity of history & culture, natural beauty, weather and laid back Mediterranean lifestyle. Moreover, with the forecast growth in Croatian tourism and pending European Union entry they perceive the country as a good medium to long-term property investment with rental income at a minimum covering costs and capital appreciation giving a solid return.
So why invest in property in Croatia? The following are key reasons why Croatia is a solid medium to long-term property investment opportunity:
- Croatia hosts some of the most alluring and desirable locations to own real estate anywhere in Europe today.
- Culture, history and un-spoilt natural beauty.
- Expected to join the European Union in 2012.
- Harmonization of economic and political policy in accordance with leading international institutional requirements European Union, IMF, World Bank, World Trade Organisation & Nato.
- A government that is committed to fighting corruption, modernizing its judiciary and streamlining its administration.
- A favorite tourist destination with the World Travel & Tourism Council placing Croatia in the top five countries globally for tourism growth over the next 7 to 10 years.
- Tight planning controls restricting development of property in Croatia, especially on the coast.
- A restricted supply of real estate in Croatia which in turn helps to support prices.
- Stable currency linked to the Euro.
- Property in Croatia is relatively inexpensive compared with established European destinations.
- Considerable and consistent foreign investment in Croatia over the last decade.
- A solid domestic mortgage market.
Perhaps the most significant of the above is the countries accession to the European Union which, with the border dispute between Slovenia and Croatia now in arbitration, is expected to happen within the next 2 to 3 years. Apart from the package attached with European Union accession namely judicial reform, financial support and policies to help safeguard foreign investment in Croatia and all of which will encourage inward investment in Croatia, we believe its timing will coincide with a global economic recovery. In doing so the Croatian property market should receive a double whammy, which in turn should drive both demand and prices for property in Croatia.
In conclusion purchasing property in Croatia should be on the list of any discerning real estate investor looking for a good medium to long-term investment opportunity or holiday home buyer looking for a beautiful un-spoilt coastal location in which to own a second home. With pending European Union entry and global economic recovery imminent, owning property in Croatia will once again be at the top of the list of investors from across the globe.
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