Cool Croatia Property

Country: Croatia

Dramatic is the only superlative that can be used to describe Croatia’s coast. Almost 2,000 kilometres of shoreline, over 1,000 islands and a picture-perfect setting in the Adriatic are all reasons in themselves to visit the country, and, if you needed another, its property market isn’t bad either.

Formerly part of Yugoslavia, an established destination for British tourists, the war in the early 1990s brought tourism to a sad halt. The collapse of communism and war of national survival eventually resulted in Croatia’s independence and the country once again has secured a place among Brits looking for a holiday destination and more. With full entry to Europe scheduled for 2010/11, this country is firmly back on its feet and travelling around today thankfully you see little signs of the war that destroyed much of Croatia’s heritage.

Cushman & Wakefield, an established agency that has been operating in the UK since 1907, also has an international division and Croatia is the latest addition to its portfolio. Marketing manager Victoria Doyle says: “We’re based in the UK but have all been out to Croatia and we love it. It’s very unspoilt and a real delight.” Like many selling agents throughout the country, Doyle believes that the war, despite its heavy toll on lives and the environment, partially protected Croatia: “Because of the war, Croatia didn’t develop as some countries did so you don’t see the mass development which mars other countries’ coastlines.”

So keen has the government been to protect Croatia’s innate beauty, at one point it issued a moratorium on all new-build, bringing development to a screeching halt while a re-zoning programme was established. Some developers are still sitting on large parcels of land but the moratorium has been lifted ensuring that only developments that strictly adhere to the government’s stringent building regulations can continue. Cushman & Wakefield specialise in selling new developments with strong investment potential. Project manager Charlie Winand feels that its development Kavanjin, on the island of Brac in southern Dalmatia, contains all the elements to make it a great investment: “It’s being built by an established developer, we’ve done all our due diligence and, even with a conservative estimate, we think that property prices will rise by around ten per cent over the next 12 months.”

Linked by ferry to better-known Split (a cosmopolitan city often compared with Barcelona or Lisbon), Kavanjin is being marketed as ‘a luxury boutique development and an island hideaway’ thanks to its great location: A 45-minute ferry ride takes you to Split but in under half an hour you can also be on the alluring islands of Korcula and Vis and reach Hvar, which is fast gaining a reputation as a ‘party island’. The first phase has already sold out but the second phase consists of one-, two- and three-bedroom apartments, many with sea views; the small, upscale development also comes with its own café and communal pool. With prices of Split property starting from £85,000, gross rental yields are predicted to be around 6.5 per cent and, with tourism set to grow, the odds look favourable. “Currently there are not enough beds to go round and this development already has a management company in place,” adds Winand. Of particular interest to investors, property buyers who form a company as a vehicle through which they then buy the property for sale can claim a VAT rebate of 22 per cent of the selling price. Other incentives for buying Croatia property include no capital gains tax after three years of ownership.

Winkworth has also recently opened an office in Croatia, in Dubrovnik, which Winkworth’s managing director, Dominic Agace, calls: “A key addition to our growing international network providing new investment and second home opportunities for our client base. With a strong infrastructure and great settings, Croatia, and in particular Dubrovnik, will continue to grow as a boutique destination for international travellers and with this trend the strength of the property market will grow.” Winkworth is currently selling a three-storey resale property in Orebic, Pelješac, Dubrovnik. Currently divided into apartments, the property has sea views and is for sale at €880,000 (£630,000).

Often dubbed ‘the jewel of the Adriatic’, Dubrovnik is a stunning and easily explored city. With a relatively small population of over 30,000, it sprawls along the coastline for several kilometres, but its old town is surprisingly small and easy to explore on foot. Walking its city walls is one delight you can’t miss, and a steady stream of tourists pour down the city’s main street, the Pile Gate, also known as the Stradun, in summer months. A good base for house hunting, Winkworth hopes to offer opportunities to property buyers, investors and developers throughout Croatia from Istria in the north, down to Split and Trogir deep in the heart of Dalmatia.

Many property buyers looking to buy Croatia property know exactly where they want to be, says Savills’ Jelena Cvjetkovic, who calls them a ‘sophisticated and well researched’ bunch. Many come from a sailing background and are seeking a base from where they can enjoy their passion, but increasingly investors are searching out hotspots such as Split and, more recently, Zagreb, where she estimates property prices are rising by around 15 per cent annually. “It’s a not a tourist destination but it is underpinned by a solid domestic market with property prices far lower than most European capital cities,” adds Cvjetkovic, who also says that great value can be found on Lopud and Sipan in the Elaphite Islands between Dubrovnik and the Pelješac Peninsula. Current properties for sale in Zagreb include the Gramaca apartments – ‘urban villas’ with one apartment per floor, a popular concept in Croatia in recent years. Designed by award-winning architect Marko Piljak, the apartments are in an upmarket area of Zagreb and have wonderful views over Mount Sljeme, which hosts a section of the world skiing championships annually. Property prices range between €248,000 and €760,000 (£195,000 and £600,000).

Up in the north of the country, Istria is fast becoming a rising star among investors and this is where you find the country’s only decent sized golf course, although several more are in the planning stages. Full of spectacular hilltop towns and rolling valleys, this part of Croatia is often likened to its more expensive Tuscan counterpart across the Italian border, and part of its attraction is the ease with which you can slip across. Foodies flock here, as cuisine is also Italian-based: pasta and pizza is abundant, and you can enjoy the truffles for which this region is famous. Istria is Croatia’s most developed region in terms of tourism, sadly there are pockets of ugly development on its coastline catering to the hordes of Germans, Austrians, Italians and Slovenians who flock here, but you’ll also find smart spots such as the Italianate Rovinj on the west coast, which caters to a chic and upmarket crowd.

Adriatic Riviera is currently marketing an exciting project in Istria at Novigrad, 20 minutes from the much-loved tourist spot of Porec. The Nautica Project is a few minutes stroll from the new five-star marina, the beach, and the town centre, which boasts many restaurants, cafes, bars and shopping facilities. All apartments have a balcony and car parking space and prices of property for sale start from €123,000 (£97,000) up to €185,000 (£146,000) for three bedrooms. Accessibility to this part of the country is good and property buyers here can fly into Pula, just 45 kilometres away, Rijeka, or Trieste and Treviso in Italy.

First published in September 2008.
Some information contained within this article may have changed since it was first published. Homes Overseas strongly advises you to seek current legal and financial advise from a qualified professional.

Ginetta Vedrickas

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Some information contained within this article may have changed since it was first published. Homes Overseas strongly advises you to seek current legal and financial advise from a qualified professional.

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