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Post by Anna on Feb 5, 2006 18:46:06 GMT 1
The Croatian daily broadsheet newspaper, Vjesnik, recently published a series of articles which negatively portrayed foreign purchasers in Croatia. Most of the articles were either untrue or stretched the truth: one article stated that Brits were absolutely flooding the Croatian property market!
In another article, it strongly highlighted the fact that prospective buyers from Britain were obtaining mortgages to fund their purchases - nothing unusual in this!
The latest article, published two days ago, was headed "New Tricks by Property Purchasers". It described some buyers who neither want the long wait for obtaining Ministry of Foreign Affairs permission or to buy via the company method. Instead purchasers buy the property and keep the name of the Croatian vendor on the deeds; at the same time, they also set up a legal contract stating that they can have the property for their sole use and that the original Croatian owner cannot sell the property at any point in the future. Apparently, this is a fullproof method of obtaining a Croatian property with few complications.
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Post by Ribaric on Feb 5, 2006 19:01:23 GMT 1
I'm not being in the market to buy, but there is a demand and naturally, whatever obstacles are in place to curb a demand will be "got-round" by one means or another. A bit like Croatians paying income tax. I am wondering how many people would rent a place if only the 3-month restriction wasn't in place? A foreigner can't stay here unless they have good reason - spending foreign exchange and generally contributing to the economy isn't enough. Why is this foreign action deemed as negative?
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Post by ambrose on Feb 5, 2006 20:54:24 GMT 1
A close friend of mine was informed about this article before it came out in print, he was informed by a friend in government. One main worry of this government is the influx of Chinese Nationals, whom, after a certain stay of leave will be able to import their close family (all 500,000 of them) I am sure certain know-alls will attack this statement but it does originate from a high ranking source.
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ianl
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Post by ianl on Feb 5, 2006 23:18:04 GMT 1
Well that 'new tricks' seems to describe us, maybe its even our case they are citing! We bought recently and drew up as strong a contract as we could so that we had exclusive rights to the house until such time that we gained permission and legal ownership, either by private or company route, and that if the original Croatian owners sold the property again we still had exclusive rights and could immediately convert to ownership by the company route leaving the new purchaser completely out in the cold.
I mean, what on earth do they expect?? That we pay the full price for a property, have to live with the uncertaintly of not legally owning the property for at least 2 years (and the 3 year period for CGT only starting then) and if the person whose name is on the land registry sells again, we're just going to say, fair cop guv, we'll move on, no problem.
Doing it this way is hardly without complications. If the system allowed, we want our name on the land registry now so that it is legally ours now when we have paid for it, not at some uncertain time in the future.
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Post by mambo on Feb 6, 2006 1:27:20 GMT 1
Ian,
I fully agree with you, if there is a legal way to bypass the system then you should use it. Legislation en regulations in this country are a disaster and if you would wait for the government to change them you can wait a few more years.
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ianl
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Post by ianl on Feb 6, 2006 8:17:39 GMT 1
But I don't understand why doing your best to prevent the people whose name is on the land registry from selling again what you have already paid full price for, is thought to be 'tricky' or bypassing the system. Are they saying that the Croatian owners should be able to sell over and over again?
What is this broadsheet Vjesnik like? Is it like the Sun, or Bild? I found it online but since my conversational skills in Croatian are still limited to numbers and days of the week in Anna's mp3 language files, its a bit hard going for me to understand it. I'm trying to learn but progress is slow.
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Post by seka on Feb 6, 2006 12:22:22 GMT 1
"Vjesnik" is supposed to be the most serious CRO newspaper, not like Bild or Sun, but more like The Times of London.
But I am surprised how naive some of their articles are. Particularly those in connection with property investments by foreign nationals. The CRO government allowed the CRO people "family silver" (banks, telephone co., oil etc ) to fall into foreign ownership very cheaply (or almost free), and now they object of foreign nationals buying property in Croatia at full market value. Madness!!!
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Post by mambo on Feb 6, 2006 15:55:59 GMT 1
Well, that 'family silver' had already become 'family garbage', so selling it to foreigners was the only way to make something of it.
It is sad to see that is country is so incapable of thinking in an entrepreneurial way. Like the National Competitiveness Council already noticed, Croatians think that foreign investors (companies) want to make a quick buck, take the profit and run.
I don't understand either why the whole process of approving an acquisition has to take more than a year. Bureaucracy is killing this country, but one thing I do know is that you have to be extremely careful with leaving papers on the name of a former owner. It is not so much that it is illegal, because it is not. It has more to do with the fact that 80 % of the Croatians can not be trusted in cases like this (at least in Istria). They know that the court system does not work, a court case like this would take at least 10 years to reach some sort of verdict and since you can still buy a verdict (if you have the right connections) they may even think they can get away with it. Before you know it you are over your neck in legal procedures and if there is one thing you don't want it is that.
I think that, if I would do it like Ian is doing (which is a very clever construction) I would ask for a blank cheque from the owner, only making sure that he has the money to cover that cheque. Blank cheques is something very common here in Croatia, so not a big problem asking for it.
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ianl
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Post by ianl on Feb 6, 2006 21:30:58 GMT 1
Well if there was a way NOT to leave the papers in the name of the former owners, I would do it but the only way to do that seems to be to buy via the company route and I'm not sure I want the hassle of that. So the only alternative seems to be the private route during which time until permission is granted it is legally still in the names of the former owners. So its the Foreign Ministry that is keeping the names of the former owners on the books for years, not the new purchasers!!
As for making a quick buck and getting out, that's not why we decided to buy. It was simply the first country we had visited that we decided that we wanted to keep on coming back to and hopefully we are in for the long term. And by us doing this we have spent a huge amount of money which has effectively gone into the Croatian economy from the UK economy and there will be more as we spend money earned in the UK in Croatia.
So on all sorts of counts I believe that foreigners do help and boost the economy and are a net benefit to the area. (I hope that I am not just self-serving deluding myself) but I am sensitive to the argument that foreign buyers price out locals (particularly young people) out of the housing market and in truth I don't have a comfortable answer to this.
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Post by Mirko on Feb 7, 2006 20:41:13 GMT 1
Not all CRO newspapers are like Vjesnik. Rijeka's daily Novi list has criticised the CRO government recently for trying to make it difficult for foreign nationals to buy property in Croatia. This is welcome, because there is no valid reason why a private individul should not sell his or her property to whoever he or she wants.
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morem
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Post by morem on Feb 10, 2006 20:58:16 GMT 1
The problem with foreigners buying property here is only about one thing: the coast is being devastated by that terrible apartment buildings! Even though the foreigners are interested in stone houses, nice lots of land, picturesque villages...the truth is that many of them are buying apartments. The apartment buildings have changed the picture of our coastal towns and villages in less than 4 years! This is definitely not the coast of my childhood and not the place where any of you will be when even more tourists come looking for their apartment! You will sell..and try to make profit. How about renting an apartment for a summer instead of buying them? How about renting an apartment in Istria one year, in Zadar next year, in Hvar the year after that...? In Greece the year after?
What we are dealing here are hundreds of fast and poorly built apartments and houses ( wait couple of years and you will find out for yourself) that have ruined everything and destroyed most of the beautiful villages on the coast.
Of course, it is not British to blame for it, it is us who are selling and keeping quiet looking corrupt government and local officials giving the "green light" for projects like that.
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Post by mambo on Feb 10, 2006 23:16:02 GMT 1
I fully agree with you, I don't like those concrete villages either. In one way you cannot blame the foreigners from buying, if it is available they will buy. The local government should however have more strict regulations what is acceptable and what is not acceptable.
In Holland we even have a 'schoonheids commissie' or 'beauty commission' (although I have sometimes the idea they are blind), but all building ideas have to pass their office and many don't pass the test.
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Post by Madgolfer on Feb 11, 2006 12:03:56 GMT 1
When we bought our property in Vrbovec last year a journalist from "Vecernji list" turned up on our doorstep within two weeks of us moving on site, asking for an interview! Apparently a 'freind' of the editor had relatives living nearby and word (or fear) had spread about this invasion of British. His questions started off nicely enough but got much more loaded toward the end, becoming more political, economic, Gotovina etc. The article did run and thankfully was well balanced. Since then we have had a number of other people just turn up on our doorstep for a 'chat' and nearly all have been just to make freinds and see what we are about. Several people have asked how many more of us Brits will come? Lets not forget that we are the wealthy foreigners here and the natives have every right to be suspicious or dubious of our intensions. We had to comply with the regulations just like the rest of you buying via the company route, but once its done its done! Knowing the officials here I do not like to think how much MORE difficult they could have made it for us if they we worried we were trying to buck the system in some way, legal or not. Articles like this are not helpfull !
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vanetta
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Post by vanetta on Feb 11, 2006 12:41:29 GMT 1
Morem
How do you know that these apartments are rubbish ‘fast and poorly built apartments’ If you are an expert on such matters, then forgive me for my rudeness, but obviously you must have proof/evidence of such a statement?
I would imagine it is a similar story as to builders in the UK, or any where in the world for that matter. Good and bad. And that’s up to the individual to find out at the time. New apartments/buildings would have guarantees.
‘Of course, it is not British to blame for it’ – I think you were holding back there!!
Isn’t this what Croatia wants and needs, more investors, tourists, more business perhaps? To help the economy, which in turn will help the people of Croatia. You would not think so on some of the comments made on this forum at times. Not everyone is after making a quick profit, some want to come out and live. They feel it is a beautiful country, love the people etc. So why do you make these statements in trying to put us off. Make it sound so bad!!
Don’t get me wrong; I do understand your concerns. But the fact remains these apartments are available like Mambo says, and people will buy them ‘foreigners’ but hopefully not just to make a quick pound. Those that have bought for an investment will bring tourists, money into the local communities which is good isn't it?
I thought the government had stopped the building on the coastline etc. I got the impression that the government was clamping down on such future developments on the coastline, is that not the case? And obviously I can’t say on that score because I have not seen all the coast line – but do you really not feel this is helping you, your family, Croatia in anyway at all.
I am really trying to be positive about this. Having just been one of those ‘foreigners’ buy an apartment!!! Your post was more like a threat ‘what we are dealing here are hundreds of fast and poorly built apartments and houses (wait couple of years and you will find out for yourself). And something I did not need to read!!
And this being a forum in helping ‘foreigners’ get to know Croatia I should imagine it has had quite an effect on a lot of people, either those thinking about buying, or those like me having already bought.
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Post by mambo on Feb 11, 2006 13:20:19 GMT 1
Building on the coastline is still allowed, but not for apartment buildings, i.o.w. if you build just a house it will be ok, if you decide to build 10 apartments..........you won't get permission anymore (at least, you should not get permission anymore).
I personally don't think that the quality is real bad, but most of the time they won't use expensive building material. There is nothing wrong with that, you simply have to replace it earlier.
One thing that I do absolutely hate are 99 % of the designs. They are simply blocks of concrete, no fantasy, looks like the Sovjet Era again. This greatly reduces building costs of course, thereby raising the profit levels to astronomical heights, but it can be done diffrently.
Just recently I found a new project in the neighborhood of Porec, they are building 10 houses/apartments, but all in the original building style i.o.w. they use only natural building materials, no concrete, it looks beautiful. I understand that this type of building cost a lot of money, but the result is there. When you enter this project you have the idea you are stepping into the past again, the way houses were built over the centuries. When all future projects were build this way I have no problems that they keep building.
As an example how it should not be done, one can look at a new 'bunker' in Porec, in front of the fire brigade. It was build in 7 months, pure concrete, ugly as hell, does absolutely not fit in the surroundings, I wish they put dynamite in the walls and destroy it again. Apparently somebody with good connections was able to get this land (which already was a surprise) and subsequently was able to pass the plans through the inspectors. What a F****ing disaster !
I really don't understand that local officials don't understand that they are destroying their own town if they keep behaving like this (thinking only about their own wallets).
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