Croatia’s Investment Property Market a Rising Star

When Croatia signed the EU Stabilisation and Association Agreement in 2005 their chances of accession to the European Union were massively boosted; as a direct result, foreign direct investment began to flood into this stunningly beautiful south-eastern European nation immediately.

One of the main sectors of the Croatian economy to benefit substantially from this continuing flow of investment is the investment property market and this article explains why Croatia’s emerging real estate sector is truly a rising star.

The Croatian government and people have been resolutely committed to transforming their country from a former communist state into a modern market economy under democratic rule, well able to compete on the world economic stage - and incredibly they have succeeded in turning Croatia into an Eastern European success story in just fourteen years.

The commitment of the people has literally paid dividends because Croatia has been accepted as a stable emerging economy for quite some time, and since 2005 the numbers of international companies who have established bases in Croatia or trade links with the country has exploded.  Furthermore the country is now fully on track for EU membership which means international investors are turning their attentions to this country because it presents them with such potential.

One area of the Croatian economy that the government have succeeded in improving substantially is the tourism market.  The country has over 6000 km of unspoilt coastline, over 1,000 islands basking in the Adriatic Sea, it has a fantastic summertime climate and furthermore Croatia is a nation with an almost inimitable array of diverse natural attributes that are proving to be an irresistible draw for visitors from across Europe and beyond.

Those who are waking up to the beauty of Croatia are also waking up to the potential for profit from the property sector.  The demand for villas to rent out in the spring and summer has surged, the demand for second homes in Croatia, particularly on the Dalmatian Coast, on Croatia’s inhabited islands and close to the ancient city of Dubrovnik has increased incredibly and there is even demand for residential and commercial property to let in Zagreb and Dubrovnik.

Property prices in Croatia range from incredibly cheap to massively affordable, but since 2005 the market has suddenly burst into life and not only has demand surged for property in Croatia, the prices people are willing to pay has increased and as a result property prices across Croatia are rapidly increasing.  The largest percentage gains currently achievable are from quality villas located along the coast and from well located and presented apartments in the country’s main cities.

An example of they type of superior villa accommodation an investor could purchase in Croatia today is offered by the Sipan Island Resort close to Dubrovnik.  Here a five star resort comprising yacht marina and hotel has been built on the beautiful island of Sipan and in amongst the resort a series of private villas are being built and offered for sale to investors or those seeking a home in the sun. 

Options exist for the investor to resell upon completion of the properties to realise the capital gains that will accrue over the build period, or to let out the property to the tourism market for a regular income.  Alternatively any of the properties are available for sale to those looking to retire overseas or just bag themselves a haven away from the stresses of modern-day life.

The whole development has received massive media interest because the developers of the Sipan Island Resort have overcome the well documented title deed and planning consent issues that have dogged Croatia in the past and as a result the speed at which properties have been snapped up on Sipan Island is almost unprecedented.

The popularity of this development just serves to highlight the quality of the property developments being undertaken across Croatia and the depth of international interest that exists in the Croatian real estate sector.  The Croatian investment property market seems to offer the impossible - a mature emerging market - and any international real estate investor looking for an exciting opportunity should turn their attentions to the rising star that is Croatia.

For more information about the Sipan Island Resort, click here.