You have finally decided to make a major investment such as buying a property in Croatia. You have a certain budget available, but you are not sure whether that amount will cover not only the purchase price but also all additional costs that may arise.

You may have heard different “advisors” say that they had to pay some kind of tax, something to a lawyer, something to a notary. Then a neighbor tells you that when he bought his property, he didn’t pay any tax or additional costs at all.

In this article, you will find out in detail whether you have any additional expenses when purchasing real estate in Croatia, how much they are exactly, and who they are paid to.

So that you have a complete overview of all expenses and can properly plan your budget, I will also calculate a real example in numbers. Make sure to read until the end.

A video has also been recorded on this topic, which you can watch by clicking on: WHAT ARE THE COSTS WHEN BUYING PROPERTY IN CROATIA ? (with English titles available)

COSTS WHEN BUYING REAL ESTATE

1. Purchase Price of the Property

The main and largest cost is, of course, the price of the property itself. This amount is paid to the seller. That part is generally clear to everyone.

2. Real Estate Transfer Tax

The second important expense is tax — specifically Real Estate Transfer Tax.

This is a tax that you pay only once, at the moment you purchase the property. It is paid to the Croatian state budget, and it is always paid by the buyer, not the seller.

The amount is 3% of the property value stated in the purchase agreement.

The Tax Administration usually accepts the price stated in the contract. However, in some cases, if the declared price is significantly lower than the market value, they may issue a decision requiring payment of tax based on a higher assessed value, comparing it with similar properties sold in the same area at the same time.

You must pay this tax if you are purchasing from a private individual (a natural person).

However, if you are buying a newly built property from a developer (a company registered in the VAT system), you do not pay the 3% transfer tax. In this case, the seller already pays VAT, and since double taxation is not allowed in Croatia, the buyer does not pay Real Estate Transfer Tax.

You will always know in advance who the seller is and whether you are obliged to pay the 3% tax. Since it is more common for sellers to be private individuals, it is safer to calculate your budget assuming the 3% tax applies. If it turns out you do not have to pay it — even better, you save a significant amount.

3. Real Estate Agency Commission

If you hire a real estate agency and sign a Brokerage Agreement, you pay the agency a brokerage commission, which is an agreed fee for their services.

The commission is always expressed as a percentage. Always check in advance what percentage the agency charges and what services are included.

Here in Dalmatia, where I operate, agencies typically charge 2% or 3% plus VAT of the agreed purchase price. The exact amount is always defined in the Brokerage Agreement.

With some agencies, the commission includes:

• Lawyer’s fee for drafting the purchase agreement

• Notary fee for signature certification

• Land registry fees for registering ownership

With other agencies, legal services may not be included. It is very important to clarify this in advance to avoid misunderstandings.

If you purchase a property on your own without hiring an agency, you do not pay any commission. However, it is still highly recommended to hire professional assistance — particularly a lawyer — to:

• Check all documentation

• Draft the purchase agreement

• Register your ownership in the land registry

It is strongly discouraged to draft contracts yourself or use generic templates.

Additional Cost If You Take a Bank Loan

All of the above applies if you are purchasing with your own funds.

If you are taking out a mortgage loan in bank in Croatia, there is an additional cost: solemnization of the loan agreement with a notary public.

This cost is always paid exclusively by the buyer. This amount typically ranges from €500 to €1,000, depending on the loan amount, the notary’s official fee schedule, and the complexity of the purchase agreement. You should check with the notary public for the exact fee.

EXAMPLE AND EXACT COST CALCULATION

Let’s summarize everything in numbers.

For example, if you are buying small seaside apartment for €100,000 (rounded for easier calculation, from a private individual (meaning you pay 3% Real Estate Transfer Tax), you are not taking a loan, and you are purchasing through an agency that charges 3.75% including VAT, the calculation would look like this:

Property price:

• €100,000

• 3% tax: €3,000

• 3.75% commission: €3,750

TOTAL: €106,750

In this example, there are no hidden additional costs, and the agency handles the entire process for you.