Build or buy a house in Croatia – What is more profitable?

When dreaming and planning to build a dream home, vacation home or rental home, one of the first questions that arises is: is it more profitable to buy or build a house? That is, how much time can we save if we buy an already built house, or how much money can we save if we decide to build our own construction?

In this article, we will look at the problem from all angles and try to answer the question which is more profitable – both financially and temporally.

Advantages and disadvantages of building a house in Croatia

One ​​of the biggest advantages, if we decide to build a house, is complete control over the entire process. Our freedom to choose materials, design and arrangement of rooms allows us to create a space that is fully adapted to our wishes, needs and desires. 

It is a privilege that buying a ready-made house does not offer – there is no opportunity for personalization and creative freedom. In addition, we can invest in the latest technology when furnishing the house, which contributes to energy efficiency and a modern look. Also, new construction often does not require repairs or investments that are common when buying older houses.

Još one advantage is that newly built houses usually achieve a better market value compared to those that have already changed hands.

However, investing in building a house also has certain disadvantages. First, there are significant financial and timeš costs. The financial ones refer to the purchase of land, building materials, creating documentation, financing the workforce, engaging architects and designers, furnishing the interior and unforeseen costs that may arise during construction.

It takes much longer to move into the house we are building, compared to buying a ready-made object. Construction requires constant decision-making, assessment and coordination of various phases of the project.

For those who are ready to invest their own work, building a house can be an extremely profitable investment, because it enables additional investments and personal satisfaction in the process of creating your ideal space.

Advantages and disadvantages of buying a house in Croatia

We can say that disadvantages when building a house are often advantages when buying one already built and vice versa. One of the biggest advantages of buying a house is at the time – we don’t have to wait for the house to be finished in order to move in.

When buying a house we also have the possibility to negotiate the price, which allows us to reduce costs. By purchasing a ready-made property we get an immediately habitable space in an established environment. If we decide on an older house, we will also get a piece of history with it, a story carved into the walls.

Since there is no need to build and worry about bureaucracy and paperwork, the whole process is much simpler, with less stress.

However, buying an already built property may require investments in repairs and renovations. Also, we are often limited in the possibilities of changes, for example if we do not like the layout of the rooms or the size of the space.

If the house comes with equipment, there is a risk that the equipment will be dilapidated or of second-hand quality, and this may also represent an additional cost for renovation or replacement.

Comparison of costs – Which is financially more profitable

When we compare the price per square meter purchased and the house we plan to build, we certainly should take into account that they are in the same area because often houses in the suburbs will be cheaper than those in the city center.

Many factors affect the price of a built and constructed house. When buying a house, we know the complete price in advance so we don’t have to pay separately for land, permits, workers, materials and other things. We can also negotiate and lower the price at which the house is sold. 

Building a house, at first, seems more financially profitable because, unlike a ready-made house, we have control over the construction process, that is, over the costs. We can save on cheaper materials and also, if we can do part of the work ourselves.

The answer to the question which is more profitable is not simple and can vary from a slight to a significant difference, depending on what we are willing tošsave on. Certainly, before making this decision, the advantages and disadvantages of both approaches should be put on paper because then we will have a clearer picture & this will help us in making a decision.

Time and effort – How long each process takes

When we compare how much time and effort is necessary to invest in building and how much in buying a house, as well as when comparing costs, we can conclude that there is no exact answer and that each case should be looked at individually.

According to some estimates, it takes between six months and two years to build a house, from conceptual design to moving in. Whether it will take longer or shorter depends on the configuration of the terrain, weather conditions, our finances and other factors that we cannot predict.

Part of the time will be spent on preparing the paperwork and obtaining the building permit & it depends on the regional office, surveyor, architect, structural engineer and ourselves. This phase can take up to several months.

The construction itself can take six to seven months. The house can then be moved in, despite šsome final details stillš they are not finished.

If we decide to build a prefabricated house, the period “from idea to moving in” will be somewhat shorter, although not as short as we think. This period covers a period of five months for a partially completed project or about eleven for a “turnkey” project.

When buying a house, other questions arise. Too many or too few choices, or the search for the ideal property, can take a lot of time.

If we are so lucky, and immediately find the house of our dreams, which meets all our criteria, we will save time. The amount of time depends on our criteria, the state of the market, the luck factor and the real estate agent.

With an excellent real estate agent, one who knows the market, the process of searching for the ideal house will cost us less effort, time and stress.

It is estimated that buying a house takes about four weeks on average, if it is not bought on credit. In the case of buying a house with the help of a loan, the process may take a little longer because the bank may ask for an appraisal of the property.

Taking into account a rough average for both processes, it can roughly be said that building a house takes between šsix months and two years, while buying a house usually takes between one and three months.

Which option is better for investors?

Which option is better for investors is one of those questions to which the answer – it depends on several factors.

Building a house, although it allows greater freedom and better control over the process, requires a significant time investment. When selling a newly built house, the selling price often exceeds the total cost of the investment, but the construction process itself is complex. It consists of several phases that can easily get out of control, which can lead to additional costs and extended deadlines.

Purchasing a ready-made house, although it brings less customization, often enables a faster return on investment – either through resale or through rent.

Since there is no universal answer to this question, investors could consider a third option – buying a house or renovation project. This kind of investment often represents the best compromise because it combines the advantages of both previous options.

Conclusion

There is no universal answer to the question of whether it is more profitable to build or buy a house – everything depends on the individual circumstances, priorities and goals of the investor. Construction offers greater freedom, better cost control and potentially greater value in the long term, but requires more time, commitment and patience.

Buying a house is a simpler and faster option, but often with less room for adaptation and additional renovation costs. For those looking for a balance between those two worlds, buying a house for adaptation can be the most cost-effective solution.

The key is a good assessment of one’s own possibilities, market conditions and long-term plans.