Euros to Pounds : Croatia

Now you might wonder why we are looking at Croatia to invest in when the euros to pounds property croatia currency at present is the Kuna ( HRK), so you will have to convert you euros to pounds, into Kunas. The answer is simple - I believe that the country offers an excellent investment opportunity even though at present it is not an EU member, but simply a candidate country. (In addition it has great sailing which I love!!)

This in itself is important as it is a good indictor of who is likely to be invited to join in the future, and assuming that they achieve all their monetary and fiscal goals, then I see no reason why they will not be admitted a s full member state in due course. As with Slovenia, Croatia could be a great place to invest

In the 1980's Croatia was one of the most exciting emerging destinations for overseas travel and investment, with almost half a million visitors annually from the UK alone. The devastating war in the region saw the former Yugoslavia ripped apart by a civil war of devastating proportions. Now, over 15 years on, this small country is now returning to some of its former glory.

Euros to Pounds : Buying in Croatia

Croatia became an independent state in 1991 as part of the break-up of former Yugoslavia. The Zagorje region, north of the capital Zagreb, is a land of rolling hills, while the fertile agricultural region of the Pannonian Plain is bordered by the Drava, Danube, and Sava rivers in the east. Over one third of Croatia is forested. The best known feature of Croatia is the Dalmatian coast with its hundreds of islands and the historic cities of Dubrovnik, Split and Zadar which are a magnate for yachtsmen and sailors from around the world. These are some of the finest sailing waters anywhere in the world, and indeed the first of a several new super yacht marinas has recently been announced. If you would like further details please just follow the link here - new marinas

OK - so you've discovered Croatia and are looking for a property - how do you go about buying. There are two ways to purchase, either as a company, or as an individual. As well as paying cash, a foreign buyer can currently only finance a property purchase using a leasing agreement, or by setting up a Croatian registered company and borrowing through a mortgage. OK, let's look at the different options available and how they work :

Individual Cash Purchase
As with many other countries, please ensure you find a good lawyer who understands the legal issues of property purchase, and also speaks your language, as all documents will need to be translated.
The first stage is a reservation contract to secure the property
The next stage is a preliminary contract for a foreigner to buy a property - at this stage you will need the 10% deposit. Your lawyer will then apply to the Land Registry office for searches etc
The final stage is the purchase contract when payment is made in full and the property is registered with the Land Registry Office.
The final contract is normally available in 3-6 weeks. The contracts must be signed and witnessed by a local notary who then applies on your behalf to the MFA ( Ministry of Finance and Affairs ) for approval.
The process is very similar to that in Cyprus - you can use the property and your rights are protected in the event of your application being rejected. This normally takes between 6 to 10 months, and only 2% of applications are rejected.
Purchase Through A Company
The company can be 100% owned by a foreign national
Your lawyer will establish the company for you, which normally takes a few weeks
Having established the company you will need to keep accounting books for the company, even if there is no activity. You will require an accountant to present these correctly.
The cost of setting up the company is approx. 20,000 Kuna, or 2,700 euros. Annual costs will be approx. the same
Once the company has been set up, the process for buying the property is the same as above, except there is no need for formal MFA approval

Euros to Pounds : Finance Options

There are two options for financing your property purchase in Croatia, either using the company outlined above, or by a leasing arrangement.

Leasing Finance
The arrangement is called an Operative Leasing Agreement
Finance for the property can then be raised
The buyer signs the Operative leasing agreement and opens a bank account
The buyer makes a deposit and takes out insurance
The lender pays the balance to the seller, and the buyer can start to use the property paying monthly instalments
During the leasing period the lender is the registered owner
The lease allows the property to be used by the purchaser
Company Finance
The maximum loan amount is 70% of the value of the property
Repayment periods are between 1 and 20 years

Euros to Pounds : Fees & Costs

If you are buying as an individual then legal and notary costs will be approx. 1.5% of purchase price
Property tax is charged at 5% of the purchase price
A lease will cost approx. 2.5% of the purchase price to set up
Company set up costs will be approx. 2,700 euros ( and ongoing annually )

Euros to Pounds : Taxes

CGT is not applied to non residents
Income tax is 20%
VAT is 22%

Euros to Pounds : Useful Facts

€220 million is to be loaned to the Port of Zadar authority in Croatia to finance the construction of a new ferry port at Zadar.
Easyjet has recently introduced flights to the Croatian city of Split
US Magazine Travel rated the Dalmatian Islands in the top ten destinations for sailing and yachting, alongside the BVI! This is where the new marina has been built.

OK - I think that's it looking at places to buy and invest in - thank you for visiting my site and I hope you found it both useful and enjoyable. I wish you every success and I hope I have provided some food for thought on places in Europe that you may never have considered, and that perhaps you have a better understanding of the issued involved when you exchange euros to pounds!