CROATIA Law and Practice Contributed by: Marko Paulinović and Dino Vukoša, Buterin & Partneri
1. General 1.1 Main Sources of Law
Most Significant Deals The most significant transactions in 2025 included investments in the tourism sector (particularly luxury hotels), along with continued strong investment in infrastructure (railways and port capacities) and sus - tained activity in residential construction. Inflation Impact Inflation and rising interest rates have negatively affected purchasing power and the cost of financing, resulting in increased caution among banks, slower lending activity and a growing interest in alternative sources of financing, including investment funds and private lenders. Adaptation to New Trends New digital technologies are gradually entering the market but have not yet demonstrated their full poten - tial. The financial sector has proven to be more agile in this regard, thereby creating new opportunities for investors seeking more flexible financing options than traditional bank loans. Although there are no problems with financing for now, banks continue to operate under the close supervision of the Croatian National Bank. The conversion of former industrial premises into commercial and residential spaces remains marked by tensions with local authorities and differing per - ceptions of the public interest. Nevertheless, aware - ness of the need to revitalise such spaces is steadily increasing. 1.3 Proposals for Reform As high real estate prices represent a widespread issue, Croatia included, the Croatian government adopted the Affordable Housing Bill in early 2026 and submit - ted it to parliamentary procedure. The proposed leg - islation represents an overarching framework for the implementation of the National Housing Policy Plan until 2030, aimed at increasing the supply of afford - able housing both for rent and purchase. Measures include the activation of vacant apartments, the con - struction of new housing units and the introduction of tax incentives. It is envisaged that by 2030 more than 20,000 apartments and family houses could be constructed or renovated through public and public- private partnership (PPP) mechanisms, with planned
The main source of real estate law in Croatia is a com - bination of constitutional provisions, statutory legisla - tion and subordinate legislation. The Constitution of the Republic of Croatia guarantees the right of owner - ship, provides that ownership entails obligations and establishes that all owners are equal before the law. The essential statute governing the acquisition, dis - position, limitations and protection of ownership and other property rights is the Ownership and Other Pro - prietary Rights Act, which is complemented by the provisions of the Land Registry Act. Other statutes frequently applied in this area include: • the Commercial Premises Lease and Sale Act; and • the Building Management and Maintenance Act. In addition to these key statutes, numerous secondary regulations and by-laws also apply. 1.2 Main Market Trends and Deals Market Trends Over the past 12 months, the Croatian real estate market has been influenced by two opposing trends. While the number of transactions has declined, prop - erty prices have continued to increase. This trend has been particularly evident in larger cities and coastal areas, where apartment prices have risen by more than 10%, partly due to limited supply and inflation - ary pressures. Despite the decline in the overall num - ber of real estate transactions, strong demand for luxury real estate remains present, and this segment has not been materially affected by the decrease in transaction volume. Accordingly, the market continues to experience a shortage of luxury accommodation, both in the hotel sector and in the segment of high- end holiday villas. • the Civil Obligations Act; • the Physical Planning Act; • the Construction Act; • the Apartment Rent Act;
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