Croatia remains in an economic slump but has much to recommend it to property buyers and overseas investors. This beautiful country faces Italy across the Adriatic Sea and it is still considerably cheaper than many comparable European nations. City centre apartments cost around €250,000 (£178,440), while premium residences are available from €700,000 (£500,000) and are on average still 30% cheaper than their pre-crash peak price in early 2008.
A coastal haven
According to figures released by the Croatian property portal Centar Nekretnina, property prices rose by just 0.2% over the 12 months to the end of May 2015. The most popular properties for non-residents with money to spend remain traditional seafront stone houses with mooring for boats. Croatia’s coastal regions are still a strong pull for many who discovered its pristine azure waters and many unspoilt islands and natural harbours while on sailing holidays; however, despite this, the Adriatic coastline remains dotted with unfinished and unsold homes begun before the crash.
One of Croatia’s most popular cities is the Adriatic port of Split, where apartments cost an average of €2,190 (£1,563) per square metre. In the capital city of Zagreb, apartments cost roughly €1,580 (£1,128) per square metre, while a house in the country’s most expensive city, Dubrovnik, goes for an average €2,570 (£1,834) per square metre.
Just outside the urban centres, half an hour away from Split international airport, Savills recently advertised a five-bedroom, five-bathroom house in the resort town of Rogoznica for €2.65m (£1.89m). The spacious property has 449 square metres of living space and an outdoor pool.
Located virtually in the heart of Europe, Croatia is considered safe and secure by international agencies and has very low crime rates; on the downside, English ex-pats have reported an annoyingly high level of bureaucracy and red tape in property transactions and warn that the country’s infrastructure can still be somewhat unreliable. Investors are advised to engage the services of a good lawyer who is fluent in their own language. ‘There have been a few situations where foreign buyers have been taken advantage of by dubious agents and have fallen foul of confusing paperwork,’ says Mark Thomas, editor of English-language newspaper the Dubrovnik Times.
The north-western peninsula of Istria is known as the Croatian Tuscany due to its olive groves and vineyards, with Venice accessible by ferry. Holiday homes here are relatively affordable, with an average asking price of €1,700 (£1,213) per square metre. This includes attractive seaside towns such as Rovinj, where a two-bedroom duplex apartment is available for €250,000 (£178,000).
The Croatian islands are also extremely popular for their unspoilt natural beauty. Gwyneth Paltrow and Bernie Ecclestone are regular visitors to Hvar, where a 100-square-metre three-bedroom home with a pool can cost €730,000 (£521,000). Nearby Brac is popular with water sports enthusiasts and a four-bedroom house with a private jetty has an asking price of €2.8m (£2m).
Though Croatia is lagging behind the rest of Europe in terms of economic recovery, its natural charms are becoming increasingly apparent to overseas investors and it can only be a matter of time before property prices begin to reflect the true value of some stunning residential locations.