Overseas property guides for buying in up and coming investment hotspot Croatia. Plus, search for property in Croatia.

Croatia is a country at the crossroads of the Mediterranean, central Europe and the Balkans and has recently emerged as a very popular location for holidaymakers.

Bordered by Slovenia and Hungary to the north, Serbia to the north-east, Bosnia and Herzegovina to the east, Montenegro to the far south-east, and the Adriatic Sea to the south, the country boasts a Mediterranean climate that has attracted holidaymakers, particularly to its costal areas.

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Most of the inland areas experience short, cool summers and long, severe winters, in contrast to the coast, which is more temperate. For a relatively small country, local terrain is quite diverse and includes flat plains along the Hungarian border, low mountains and highlands near the Adriatic coastline and islands.

The capital, Zagreb, is home to around 750,000 of the nation's 4.4 million people and is the cultural, scientific, economic and governmental centre of the country.

Pros to Buying Property in Croatia

However, people looking to purchase second homes in the country are typically drawn to the coastal areas. As Lonely Planet explained: "With its sublime stretch of Adriatic coast, Croatia has long been regarded as one of the most beautiful parts of Europe."

For example, the visit-croatia.co.uk site noted that Istria is a popular area and is commonly referred to as the Croatian Tuscany. In particular, towns such as Porec, Rovinj, and Pula are good options. However, the site does note: "Property is quite expensive due to high demand and Istria's proximity to the rest of Europe".

The site also claimed that the regions of Kvarner Riviera and Nothern Dalmatia are becoming popular options for people. Here, it said that the seaside towns of Zadar, Sibenik, Trogir, Crikvenica, Kraljevica and Novi Vinodolsk are all good options.

However, the most popular area for tourists is currently Southern Dalmatia. It said that Split is a good place for people looking for second homes and added: "The Makarska Riviera and the ancient town of Dubrovnik are amongst the most attractive places, although both these locations are quite expensive, especially due to the popularity of the latter."

Cons to Buying Property in Croatia

Experts are currently unsure about the long-term health of the property market in the country, which is commonly deemed to be in its "infancy ".

A recent report from Amberland explained the problem. It stated: "Depending on what you read, all in the garden of Croatia’s housing market is either healthy or decidedly unhealthy! The truth probably lies somewhere in the middle.

"If you look at the most popular holiday hotspots then you will witness international demand, strong house prices and a market where properties put up for sale do actually sell.

"But step away from the tourism hotspots and the picture is very different."

Despite this caution, the Global Property Guide suggested that house prices jumped by seven per cent in the first half of 2006. Currently, the site estimates that the average price in the country is €2,215 per square metre, making it cheaper than Turkey or Portugal.

However, the site does show that popular areas are considerably more expensive. For example, houses in Dubrovnik can cost between €300,000 and €1.4 million. On the popular islands, which include Hvar, Korcula and Brac, homes can cost similar amounts. Despite this, it is possible to still find some bargains. For example, smaller apartments on Korcula and Brac still change hands for less than €100,000.

What you need to know when buying property in Croatia

The avatar-croatia.com site noted that foreign citizens "may, under condition of reciprocity, acquire real property in Croatia either as inheritance or by other legal transactions such as purchases, deeds, trusts etc".

It added: "When acquiring real estate other than by inheritance, foreign citizens need to obtain the approval of the Ministry of Foreign Affairs of the Republic of Croatia."

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