Real estate in Croatia in 2025 – an opportunity for investors

Croatia, with its picturesque Adriatic coast, charming islands, and growing tourism, has been attracting investors from across Europe for years. However, 2025 will bring a noticeable shift in the dynamics of the real estate in Croatia market – a slowdown in sales, rising prices, and increased buyer caution. For those who can analyze the market, this could be the moment to get in on the cheap. Let’s see what’s happening and how to take advantage of the situation.

Current state of the market – sales are falling, prices are rising

Decline in transactions

In the first half of 2025, the number of real estate transactions in Croatia amounted to 57,095 – a 15% decrease compared to the first half of 2024. ([Aman Alliance][1])

The decline applies to various types of real estate:

• Apartment sales – also down around -15% ([Aman Alliance][1])
• House sales – even more so, down around -26% ([Croatia Week][2])
• Building land sales – down around 17%, garages/parking spaces – down around 12% ([Aman Alliance][1])

The capital, Zagreb, still sees the most transactions, but there are about 20% fewer of them than a year ago. ([Aman Alliance][1])

Prices are rising – but at a slow pace

– In Zagreb, the average price per square meter for existing apartments increased by 16% year-on-year, to approximately €3,166/m². ([Aman Alliance][1])

– In coastal and tourist regions, apartment and house prices remain high and are constantly rising: premium locations (Adriatic coast, islands) – prices are several times higher than in less popular locations. ([Real Estate in Croatia][3])

– However, experts point out that the rate of growth is starting to slow down – especially for older, less attractive properties that require renovation. ([Aman Alliance][4])

Reasons for the slowdown

Several factors contribute to this condition:

• Prices/Availability – Real estate prices have risen to levels that are unsustainable for many buyers, especially local ones. ([Croatia Week][2])
• Credit and finance – banks and lending institutions are introducing more stringent terms; some buyers expect better terms and stable interest rates. ([Aman Alliance][1])
• Market saturation in luxury – especially large villas, properties with extras (swimming pools, very large plots), in tourist areas – they are becoming increasingly difficult to sell quickly, and maintenance costs are rising. ([nekretnine-istra.hr][5])
• Regulatory and tax changes – the government and local governments are introducing new taxes related to real estate, especially those used for short-term rentals or empty properties. This increases maintenance costs and impacts profitability. ([Reuters][6])

Are prices falling?

Here the matter is more complex: there is no strong evidence that real estate prices have generally fallen – rather, there is a slowdown in the pace of growth, some corrections in some segments, and a decrease in the number of transactions.

In many cases, prices continue to rise, especially in attractive locations and new developments. ([Croatia Week][7])

However, less desirable properties—older, located further from amenities, or in need of renovation—are starting to be listed at prices that buyers question, leading to longer sales times and potential negotiations. ([Aman Alliance][1])

For the investor – where the opportunity lies

Although prices are generally rising, falling sales and increased buyer caution are creating room for negotiation and selective discounts:

1. Older properties in need of renovation
In cities and on the coast, older properties requiring investment (renovation, modernization) are often less desirable. In such cases, sellers may be willing to lower the price to shorten the sale time.

2. Premises outside city centers or with limited visibility
Plots or buildings located a little further from the beach, from the main tourist attractions, but with good potential – may be more affordable.

3. Municipalities further from the tourist trail
Less developed regions, where infrastructure is still developing, may offer cheaper prices, but with potential for growth if tourism develops there.

4. New investments in the mid-segment
Projects that offer good quality without luxury extras (e.g. standard apartments, smaller houses) can attract local buyers and those looking for a place to live longer, not just for the holiday season.

5. Negotiating financing terms, taxes, and maintenance costs
Sellers will be more flexible – for example, regarding price, but also regarding the terms of property transfer, payment deadlines, and formalities. New taxes and regulations mean that property owners, especially those rented seasonally, may be willing to lower prices to avoid additional costs.

Risks and traps – what you need to know before you jump in

Regulatory risk: changes in tax regulations/building codes may impact the profitability of investments – for example, taxation of vacant properties, restrictions on short-term rentals. ([Reuters][6])

Maintenance and infrastructure costs – luxury properties often require high costs (renovations, maintaining the pool, garden, and access), which lowers the real rate of return.

Seasonal demand – in many coastal towns, the main revenues come from the summer season; off-season demand may be minimal, which may mean difficulties renting or maintaining the property.

Financing and interest rates – if loans become more expensive, terms become more restrictive, and inflation rises, the cost of capital will have a significant impact on the profitability of the investment.

How to get into investing – practical advice

Detailed location analysis – check the distance from important points (beach, port, airport, communication routes), infrastructure condition, development potential (e.g. spatial development plans).

Property condition – properties requiring renovation can be purchased cheaper, but the costs of repairs and adaptations must be realistically estimated.

Compare offers and negotiate – in a climate of declining sales, sellers are more willing to negotiate. Don’t be afraid to offer a lower price, payment terms, or adjusted deadlines.

Pay attention to taxes and additional costs – property taxes, local fees, legal costs, land use fees, management costs (if renting), taxes for foreigners – all of these can reduce the actual profit.

Think long term – if you buy now, even if prices in the most attractive locations continue to rise, buying at a lower price now could mean a better return if the property value stabilizes or continues to rise in the future.

Is this a good moment – ​​“time to act”

Yes, 2025 seems to be the time when the opportunities are greater than in the recent boom years. While prices aren’t falling overall, there are many signs that buyer pressure is starting to kick in:

• Declining transaction numbers – indicates that the market is unable to sustain its growth rate, as more and more properties are staying on the market longer. ([Aman Alliance][1])
• Increasing number of listings for older properties, those requiring renovations, or those located in less desirable locations – competition is greater, so sellers must be more flexible.
• Tax/regulatory changes – may act as a catalyst, forcing sales or price reductions for those who do not want to incur high maintenance costs/taxes.

Real estate in Croatia – is it worth investing?

Yes, investing in real estate in Croatia in 2025 makes sense – especially if you can choose the location, assess the technical condition and negotiate the price.

The best opportunities will be in segments that have been less attractive so far: older buildings, properties requiring improvement, locations slightly “off the beaten track”, further from the main tourist bustle.

It’s worth being patient – you may have to wait longer for a return on investment (e.g. through renting, modernization), but the lower entry cost may pay off handsomely.

Footnotes:

[1]: https://www.aman-alliance.org/Home/ContentDetail/92866 “HINA – Property market records 15% drop in transactions in H1”
[2]: https://www.croatiaweek.com/property-sales-in-croatia-down-15-in-first-half-of-2025-analysis/ “Property sales in Croatia down 15% in first half of 2025 – analysis | Croatia Week”
[3]: https://www.adrionika.com/croatia-real-estate-investment-guide-key-insights-for-2025 “Croatia Real Estate Investment Guide for 2025 | Adrionika”
[4]: https://www.aman-alliance.org/Home/ContentDetail/87623 “HINA – Housing prices in Croatia to continue rising in 2025, but at slower rates”
[5]: https://nekretnine-istra.hr/latest-news/top-5-trends-in-the-real-estate-market-in-istria-for-2025 “Top 5 trends in the real estate market in Istria for 2025”
[6]: https://www.reuters.com/markets/europe/croatia-shift-tax-burden-property-tackle-housing-problem-2024-09-23/ “Croatia to shift tax burden to property to tackle housing problem”
[7]: https://www.croatiaweek.com/croatia-among-top-risers-as-property-prices-across-eu-climb/ “Croatia among top risers as property prices across EU climb | Croatia Week”