Guide to Finding the Perfect Apartment in Croatia

For several decades in a row, Croatia has not lost its popularity as a tourist destination. With the opening to Europe and the European market, during the post-transition period and thanks to the transition to capitalism, entry into the European Union, and the switch to the euro, many foreigners, along with local residents, decided to make a profit through renting apartments or houses for vacation. However, profit is not the only benefit of owning an apartment.

Why Invest in an Apartment in Croatia? 

Due to its natural beauty, nostalgic Mediterranean charm, and the hospitality of its inhabitants, every traveler feels at home in Croatia. This is the feeling people want to keep or return to. This is why many foreigners decide to purchase property for vacation on the Croatian coast. The same decision is made by local residents, especially from continental parts of the country, who want their own piece of Mediterranean paradise. 

Another reason for buying real estate in Croatia, especially small, practical units such as apartments, is high ROI (Return on Investment), i.e., the percentage that expresses profit in relation to investment. According to some calculations, the ROI from investing in real estate in Croatia is between 5 and 10%. In tourist powers like Italy and Spain, that percentage is somewhat lower, around 7%, while the highest ROI is in Cyprus and Greece, at 11% and 12%, respectively. Considering these figures, we can say that Croatia is high on the list of desirable countries for investment, in terms of return on investment and profit.

Tourism in Croatia is still a stable industry, perhaps even overly stable considering the percentage of GDP directly generated by tourism. Despite the turbulent economic fluctuations at a global level in the past decade, Croatia remains stable and is considered a safe place for investment and profit.

Choosing the Ideal Location for an Apartment

Choosing the location for an apartment depends on personal preferences and whether we use the apartment exclusively for our vacation and family holidays, or also for renting.

The return on investment also depends on the location of the apartment. If we decide to profit from tourism, it is logical that we will look for places with greater tourist traffic and where the tourist season, ideally, lasts longer than three months.

A city that offers rapid tourist turnover and a season that lasts longer than the summer is Split, which still has the soul of a small town but the convenience of a metropolis, and is also a well-connected transit center. Investing in Split and its surroundings guarantees profit.

We can also highlight Šibenik and Zadar, student cities with rich social life that ensure rental profit year-round. 

If we prefer a smaller profit and greater personal enjoyment and relaxation from the apartment, we can choose smaller island towns or coastal villages.

New or Existing Apartment – Advantages and Disadvantages 

When we decide to make a profit from tourist rental, while researching the real estate market, aside from location, we investigate whether we should buy a newly built or an older apartment and what will ultimately be more cost-effective.

The advantages of a new apartment include modern construction standards, no renovation costs, a ten-year warranty from the developer, new installations, and no property transaction tax, which is already included in the price.

Disadvantages might include somewhat higher prices and lack of character.

When speaking about existing apartments, they will certainly require more investment, especially in terms of renovation, particularly for new installations. They tend to have fewer technical amenities and often lower energy efficiency. The advantages are certainly their established nature, established neighborhoods, often larger rooms and square footage, location, and authenticity.

Key Factors in Reviewing and Purchasing Apartments; Legal Aspects

Once we decide on location and price range, and are ready to purchase an apartment, we need to review additional factors, where real estate agents and lawyers are very helpful. These are legal factors such as documentation and ownership status, land registry check, land book extract, building or usage permits, and so on. It is also important to check whether there are unresolved court expenses or multiple owners.

It is recommended to check additional costs, such as reserves or average utility prices, if we are interested in maximizing our earnings. We need to consider profitability through, for example, researching the micro-location and its response to tourist rentals.

Costs, Maintenance, and Additional Investments

Investing in equipment and additional amenities can speed up the return on investment. We can invest in small aesthetic details, interior details, or even a complete interior overhaul. Securing a parking space or garage greatly improves the apartment’s quality.

Quality advertising, investment in marketing, and promotion can increase tourist interest, extend the season, and thus bring in more profit. 

Additional costs include taxes (flat tax on income, property tax, other payments such as utility fees, tourist taxes, membership in the tourist association, agency brokerage fees, utilities, cleaning, etc.).

Regular inspections of the apartment and ongoing maintenance generate additional costs. This includes cleaning services and investing in cleaning and laundry supplies. As a landlord, we must also be prepared to cover utility costs.

Conclusion

Investing in an apartment in Croatia is a smart and strategic move, whether looking for personal relaxation or a source of income. Thanks to its attractive location on the Mediterranean, a stable tourist market, and favorable investment return rates, Croatia has positioned itself as one of the most desirable places for property purchases in Europe. 

To choose the highest quality apartment, we must pay attention to location, clear documentation, realistic cost planning, and proper property management. Whether you choose an apartment in Split, on an island, or in a smaller coastal town, it is important to research all aspects thoroughly and consider the long-term. With the right approach, an apartment in Croatia can become not just a source of income, but also your personal peaceful corner on the Adriatic.