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Post by anniew5693 on Nov 4, 2005 15:46:07 GMT 1
Okay folks! here's the crunch question, is it still possible to buy a house on the beach or few meters from the sea in Croatia. We're looking preferably 3 storeys, to turn into two apartments and live on one level. Has to face the sunsets. How much can I expect to pay, finished or not and where? not fussed about a pool, but off street parking is a must, preferably not amongst bars etc, but a bit closer to nature. How much are these properties now? Realistically!!
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Charles
Full Member
www.aplaceindalmatia.com
Posts: 75
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Post by Charles on Nov 4, 2005 23:04:05 GMT 1
It's probably easier to say what's your budget and requirements in terms of finish. Also, how accessible to an airport as Vis and Vela Luka (Korcula) are very different to the mainland around Split and Dubrovnik. We have some friends who bought in Vinisce, about 8km from Marina, maybe 200m from the sea in a peaceful location for around the €120k mark. It had 3 apartments and required some work. We have 3 large apartments 50m from sea in peaceful location just outside Primosten for €850k. That's not a bad approximation of the range.
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Post by irac on Nov 4, 2005 23:59:40 GMT 1
Vinisce is lovely, out of this world, but there are a whole world of problems with buying there, the titles to most of the properties are not clear thanks to the machinations between church and state, currently a lot of the residents are battling with the local municipality to get it fixed, there was even an article in either Jutarnji or Slobodna about it in August (Mr. Kljakovic). You might try Zadar, some parts are cheap too.
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Post by mambo on Nov 5, 2005 3:12:30 GMT 1
If you want to have apartments on the sea you need to buy existing apartments, you cannot build them anymore. So changing a normal house into apartments would already be outside the law and probably you will not get permission for that.
Prices for a house with apartments are so incredibly high that you might as well buy a small house on the waterfront, simply live there and put the rest of the money on the bank or in the stockmarket, you will have a better return on investment than if you rent apartments.
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Post by anniew5693 on Nov 5, 2005 13:50:01 GMT 1
Our budget is quite high, we are not looking for the cheap end, but the house MUST be on the beach, nothing in front and preferably not even a road. 3 storey is preferable, even if we can only adapt 2 floors for lettings and not sub-divide. IRAC which areas of Zadar might apply? thanks
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Post by mambo on Nov 5, 2005 22:01:51 GMT 1
Annie,
The law has been changed last year or the beginning of 2005 and you cannot build any new apartments within 70 m of the coast anymore. It is simply no longer allowed and anyone who tells you that you still can is simply pulling your leg.
If you desperately want apartments on the coast then there is no other option then to buy an existing building, already separated in apartments. The owners will probably tell you that you can make 20,000 euro per apartment per year, but that is also basic BS. Realistically speaking you have to calculate with a max of 60 days (if you do well) in rent of apartments, which will bring you 3000 to 5000 euro for a year. Take the cost away and you are looking at a very lousy return on investment if you have to pay the top price to acquire the building.
That is why I said you will probably be better off by buying a normal house on the coast, just for yourself, put the money you did not have to spend in the stockmarket and that way you can make more than the 1 or 2 % return that you will get by renting apartments. And to be honest 1 or 2 % return is not a lot to give up all your privacy during the summer months. For that money I would rather have my privacy, especially if money is not a problem.
But then again, it is not my business, if you desperately want to have an apartment, be my guest, hope you will find something.
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Post by Carol on Nov 5, 2005 23:16:22 GMT 1
Mambo's calculations are good if you were only looking for rental income, however the Croatian property market is strong and with upcoming EU succession, its also liekly to offer significant capital growth. This does not mean that the share prices of companies will also not rise in the next few years, its just that croatia is in an unique phase of its history and so property owners should do well realtively speaking.
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Post by Graham - Bosmere on Nov 5, 2005 23:31:25 GMT 1
The price of property will depend on a lot of factors, not just EU succession. Anything could happen if the HR government need to raise some cash, such as increased taxes for non residents owning property, changes in capital gains tax, imposition of ecological taxes on property without proper sewerage treatment (most!) etc. Also major natural disasters such as earthquakes or bad forest fires could have a serious effect on prices.
Now I will sit back and wait for all the real estate agents to tell me I am talking cr*p and that earthquakes will not happen and that they will guarantee you a massive return on investment. Cynical - wot me.....
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Post by davidzg on Nov 6, 2005 2:52:05 GMT 1
Mambo is a smart guy and once again Graham has proved himself knowledgeable regarding Croatia, I urge all of you who want to know about Croatia to follow their honesty as opposed to listening to rubbish for real estate agents desperate to BS about Croatia.
What concerns me most is, a lot of foreigners will buy property, then realise what they bought was not as advertised, suddenly a lot of people want out, and prices fall due to huge availability.
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Post by glen on Nov 6, 2005 6:48:04 GMT 1
Of course there is some truth in the last two posts but there are still investment properties to be bought, as there are everywhere and with the potential onset of the eu how can things be that bad.
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Post by Carol on Nov 6, 2005 9:58:09 GMT 1
There is still significant investment opportunity to be had in the Croatia property market. I listed one reason in favour but there are others. For example if the open skies agreement which comes into force next year. IF a budget carrier comes here, property will soar. The reason why a budget carrier should come here are obvious. If you consider the need of a company such as ryanair to maintain its dividend ratio, then it must keep expanding. Tesco is in the same position and that's why it is also looking for overseas locations (though not Croatia, sadly).
Regarding govt raids on foreign CGT. Its always possible, but how well will it sit with the EU? Forget all the Gotovina rubbish which i think was just a smokescreen for some political maneuvering, Croatia wants into the EU and it will be sold to the people of Croatia. Croatia can't afford to do otherwise.
Given the extraordinary timescales taken to get MFA permission, its an exceptional case which would not use the company route which is subject to profit tax at 20%, rather than CGT at 25%.
I do run an estate agency, but it doesn't mean I still can't analyse an investment opportunity - its what I did for most of my working life. My husband and I both managed portfolios. We had a good income and a good lifestyle. We gave it up to come to Croatia earlier this year for two reasons - 1. we wanted a better work life balance for ourselves and our children and 2. we firmly believed that by investing in Croatia property we would be still be able to live comfortably. In essence, we put our money where our mouth is. How many of your unit trust/ pension managers have done that as they invest your money?
I know some agents will say anything, do anything to get a sale, and others are just bone lazy. We are neither. We had integrity instilled into us in the City, and money laundering and we want to do an honest job. If a house does not have clean papers and they can't be cleaned up, then we don't sell it. We cannot afford the reputational risk of ripping people of, because they always find out, and then they will just post their complaints here and we will lose our future customers. It would be stupid.
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Charles
Full Member
www.aplaceindalmatia.com
Posts: 75
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Post by Charles on Nov 6, 2005 10:55:18 GMT 1
Every company who is trying to sell something in Croatia, whether they be local or foreign is trying to put a positive spin on their product. Estate agents, naturally, will emphasise the natural beauty, the relatively good value for money and the capital gains prospects. If anyone tells you something is going up 20% a year, whether it be Croatian property, fine art or Brazilian equities you, as the buyer have to weigh up all the facts, do your own research and make your own mind up. Pointing out the risks are part of the professional service, but selling is the same the world over. Ever heard a travel agent warn of earthquake risk and that your insurance won't cover it? Don't think so. Ever heard a travel agent say that your hotel will be surrounded by half-finished concrete monstrosities? Don't think so. Ever heard a travel agent wax anything other than lyrical about the beauty and unspoilt nature of the country they're promoting? Don't think so. Anyone renting apartments on Ciovo tell you that getting on and off the island in July and August can turn into a frustrating, nightmarish hell (I've rented from a 'reputable' travel agency who somehow failed to point out this salient fact). In every walk of life there are honest, professional people as well as the opposite. I can't can't force anyone to use my services. There's plenty of competition both in agencies and countries to choose from so I'm happy to be judged on the service I provide. Can't say fairer than that!
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Post by mambo on Nov 6, 2005 11:46:23 GMT 1
The remark about prices of property rising is a nice one.
Perhaps the value will rise, but to me that would only be interesting if I have the intention to sell the property within the next 3 to 5 years. If I intend to live in it we can simply call it 'paper value', looks nice on paper, but it doesn't buy you anything.
When Ryanair or another low cost airline will start flying to Zadar/Pula/Rijeka we will see an increase in passengers.............perhaps, but will that be enough to have profits on real estate go through the roof ? The tourists that arrive by plane will be the kind of tourists that will stay in hotels (at least 90 % of them), they don't have cars, they don't have an idea where they are going, so chances that all of them will end up in apartments are slim.
If I look here in Istria 99 % of the apartments are closed/empty, there are no tourists at this moment and it will stay like this until May/June. Then we will see the first tourists arriving, but with the building spree going on, capacity (the amount of apartments) is also rising. This results in less tourists per apartment, driving the total revenue for each apartment down.
It is very simple mathematics and let's be real..........the prices of real estate are not just a little bit out of the window, these prices are not even of this planet. When real estate agents are trying to tell me that 76 m2 ruin (needs to be restored) for 145,000 euro is a bargain then they better check-in in a clinic.
How can it be that Rijeka, a major city, still sells for 500 euro/m2 and now even in Dalmatia they are claiming that the value is 2000 - 2500 euro/m2 ?
And yes I know that it has to do with the market. When ever they can find an idiot who is willing to pay it they are happy. But don't come telling me that you can make normal decent return on investments by renting aparments in the summertime, because that is basically a load of crap.
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Post by mark2 on Nov 6, 2005 17:04:59 GMT 1
Quote:"But don't come telling me that you can make normal decent return on investments by renting aparments in the summertime, because that is basically a load of crap."
The majority of property buyers, I know of, from Western Europe, have bought with (dare I say) "spare cash", whether they have made good from the UK property boom or cashed in other investments, pension plans or a remortgage. They are investors who will rent out their property as an added bonus to owning a house in Croatia, even if only to offset the price of replacing windows in the future etc..
"The tourists that arrive by plane will be the kind of tourists that will stay in hotels (at least 90 % of them), they don't have cars, they don't have an idea where they are going, so chances that all of them will end up in apartments are slim."
Our first apartment was only completed in May this year, we could have rented it during the season approximatley 6 times over, all guests we had flew here, most of them into Trieste and hired cars. We even had one UK family drove here for a 2 week stay. The majority of people who come to Croatia (as far as I have seen) come to explore and the ones who come on a package deal, may as well go to Spain as far as I am concerned!
On the subject of property prices, it is relevent to your country of residential habitation, Bulgarians won't buy here but to purchase a 2 - 3 level property for less than an ex-council house in the UK (dependant on area)looks like a decent purchase to me.
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