When it comes to buying a real estate in Croatia — you can never, ever be completely certain (100%).
Because it’s possible that only later on various legal issues will appear that were not visible at the moment of the purchase.
However — in this text, I will focus on the steps in the property purchase process which — based on experience — have proven successful in achieving the highest possible level of security when buying real estate in Croatia.
Of course, the recommendation — as always — is not to do things on your own. Always consult a lawyer you trust.
Because if you think about it — you wouldn’t extract your own tooth, even though it may seem like there’s no “big science” behind it. You take pliers and pull.
It’s the same with the law — even if it sometimes seems like there’s no “big science”, you can never be too careful.
And a trained eye can notice all sorts of details that most people simply “take for granted”.
- First: nothing works without thorough due diligence!
- Second: The Preliminary Agreement for the purchase of real estate — when is it unnecessary, and when is it essential?
- Third: The Real Estate Sale and Purchase Agreement — the fundamental document you cannot avoid when buying real estate in Croatia
- Fourth: Registration of the sale and purchase agreement in the land registry — why and how?
- Fifth: The Tabular Statement — the queen of all ownership changes
- Sixth: Registration of ownership rights — the goal we are aiming for
- Seventh: The real estate transfer tax
- Why absolute (100%) legal certainty does not exist
IMPORTANT NOTE: all texts published on lucija.legal – although written by a lawyer with many years of experience – are written in simple, conversational language. Legal terminology has been intentionally omitted for easier understanding, and certain legal concepts are explained in a highly simplified manner – while still preserving their actual meaning. All texts and examples are provided solely for educational purposes and for informing the public. None of the texts contain individualized or specific legal advice. For resolving concrete legal matters – including issues related to buying real estate in Croatia – you are expressly advised to consult with your lawyer.
First: nothing works without thorough due diligence!
When you find a property you want to buy — for example, an apartment — it is useful to check all possible information about it that you can access.
You can start with the land registry extract (which you can find online yourself) to see who the registered owner is.
In addition, the land registry extract will show whether there are active liens, notations (disputes, foreclosures, or other agreements), or any encumbrances (mortgages, fiduciary rights).
Once you confirm that the current land registry extract is in order, it is also a good idea to check the historical land registry extract.
From it, you will see who the previous owners were, the encumbrances, and whether there are potential (past) problems that could resurface once you become the owner.
After reviewing these two basics — it is common to also check the possession sheet.
The status in the possession sheet should match the status in the current land registry extract.
Additionally, from the current owner it is advisable to request all available documents related to the property (energy certificates, proof of paid utilities, etc.).
Furthermore, it is useful to inquire about the amount of reserves or heritage rents, and generally what other costs you might have for the apartment — costs that you may not currently expect or see.
Next — and this is something I would recommend to anyone entering a significant investment — check the living conditions that you can observe.
For example, you do not want to find out later that the apartment next door is empty and infested with ants and mice.
Or that there is a bell tower nearby that chimes 30 times a day.
Or that the building’s elevator breaks down twice a week.
Or that the nearby café is a gathering place for noisy drinkers.
And so on… life provides endless inspiration.
At the same time, it is also wise to check who owns the property that is selling it to you — whether it is a kind elderly lady moving to the coast or a company that deals professionally in real estate.
In other words — if tomorrow problems arise (legal or practical) with the property you bought — will they want to cooperate/help you, or will it no longer be their problem?
GOOD TO KNOW: the current land registry status is highly recommended to recheck on the day of signing the sale and purchase agreement before the actual signing. Even a one-day discrepancy can later cause a problem if the seller acts fraudulently, which is why this step is critical when buying real estate in Croatia.
Second: The Preliminary Agreement for the purchase of real estate — when is it unnecessary, and when is it essential?
In essence, if there is a possibility that you can immediately become the owner of the property you wish to purchase, a preliminary sale and purchase agreement will not be necessary.
However, if the property does not yet exist (e.g., an apartment under construction) or the owner wishes to sell it only after, for example, a year for personal reasons, it is advisable to conclude a preliminary agreement.
The preliminary agreement must define by when the main contract will be concluded (deadline) and what this main contract will include (that the seller will sell the property and which one, that the buyer will purchase it, for what price, whether a deposit is given, and whether it is agreed as a forfeit, etc.).
Still — if you intend to buy a property and enter into a preliminary agreement, it is wise to include provisions in the preliminary agreement that will protect you.
Which provisions are we talking about? Among others, provisions that establish your right:
- to terminate the preliminary agreement;
- and the right to recover the deposit
if, by the time you are supposed to conclude the main sale and purchase agreement, the land registry status is not in order.
For example, the seller might, from the date of signing your preliminary agreement until the date of signing the main agreement (usually several months), encumber the property with a loan.
Buyers then face a situation where, if they do not sign the main contract, they lose their deposit because they “withdrew”, but if they sign, they become owners of a loan-encumbered property.
For this reason — it is never advisable to sign forms provided by the seller. Instead, make sure that the preliminary agreement includes provisions that protect you.
If the seller “does not agree” with your proposed provisions — you already have grounds to doubt their “good intentions” and “honesty”, which is particularly important when buying real estate in Croatia.
Third: The Real Estate Sale and Purchase Agreement — the fundamental document you cannot avoid when buying real estate in Croatia
The sale and purchase agreement for real estate must be concluded in writing and notarized by a public notary.
If a bank is involved, the agreement will usually also need to be solemnized.
The agreement may include a tabular statement, but it is not required.
In my opinion, the sale and purchase proceeds more securely for both parties if the tabular statement is not included, and this text will continue in that direction.
GOOD TO KNOW: By law, the notary automatically sends the notarized sale and purchase agreement to the land registry court for registration of ownership rights. This means that if a tabular statement is included in the real estate sale and purchase agreement, the buyer could become the registered owner very quickly — within a day or two — even if not all other conditions agreed by the parties have yet been met.
Be careful: if you are selling, you do not want the buyer to become the owner immediately if they have not yet fulfilled the contractual conditions. Emphasize to the notary during notarization that you OBJECT to sending the agreement to the land registry court.
GOOD TO KNOW 2: Ideally, the sale and purchase agreement should include provisions defining under which conditions and how the buyer will receive the tabular statement, which is especially important when buying real estate in Croatia.
Fourth: Registration of the sale and purchase agreement in the land registry — why and how?
Once you have a notarized sale and purchase agreement, but it does not include a tabular statement, you should know that you can register a preliminary notice of ownership in the land registry. It is recommended that this proposal be submitted on the same day, immediately after signing. Here’s why.
A preliminary notice should be in the interest of every buyer because it preserves your priority. What does this mean? It means that when entries are made in the land registry, all proposals are recorded in the order in which they are received.
In other words (for example) — if you do not submit a preliminary notice for the sale and purchase agreement on the same day, and tomorrow your seller (if dishonest) concludes a sale and purchase agreement with someone else for the same property and submits the proposal before you — you will not be able to register as the owner. In that case, what you thought would be a straightforward purchase could turn into a legal dispute lasting years.
Therefore — it is recommended to register a preliminary notice of ownership.
How long does the contract remain preliminarily registered?
The sale and purchase agreement remains preliminarily registered until you, as the buyer, receive the tabular statement. Once you receive it, you will submit it to the land registry court, and the court will register you as the official owner, which is an essential step when buying real estate in Croatia.
Fifth: The Tabular Statement — the queen of all ownership changes
In practice — as the best example for resolving the question of who delivers what first (buyer to seller: money, or seller to buyer: ownership) — this method has proven effective.
The tabular statement is notarized on the same day as the real estate sale and purchase agreement, but it is stored (“kept”) with the public notary.
The sale and purchase agreement specifies that the tabular statement is “kept in custody” with the notary — for example, until the buyer provides the notary with a bank confirmation that the funds have been credited to the seller’s account. Once this confirmation is presented, the notary can issue the tabular statement to the buyer.
A free sample of a tabular statement with explanations can be downloaded here:
Sixth: Registration of ownership rights — the goal we are aiming for
The sale and purchase of real estate ideally concludes with the registration of the buyer’s ownership rights. What does “registration of ownership rights” mean? It means that in the land registry extract (which you can find online yourself) it is visible in the B sheet (owners) that the buyer’s full name, personal identification number (OIB), and address are recorded.
In our case — to register yourself as the owner (assuming a preliminary notice has already been recorded) — you simply send the tabular statement to the land registry court to justify the preliminary notice.
How long does registration in the land registry take?
From practice, this varies from court to court. It depends on the number of clerks processing registrations, the number of cases submitted, and sometimes even the time of year (summer — when everyone is on vacation — tends to be slower).
Fortunately, since all proposals to the court are now submitted electronically, the process is much faster. While previously you might have waited a month for registration, now it is reasonable to expect results within one to two weeks (exceptions, of course, exist).
You may now be wondering — what if someone else submits a proposal after me, but the land registry court has not yet processed mine? Does it matter?
It should not. On the same day that the land registry court receives your proposal, it will record it in the land registry extract as an active lien (a case under processing).
If someone else submits a proposal afterward, it will also receive an active lien, but their order will come after yours. The only issue could arise if your proposal is rejected by the court while the other proposal is accepted … but that is a story for another text, especially relevant when buying real estate in Croatia.
Seventh: The real estate transfer tax*
*(for Croatian citizens)
I have already written in more detail about the real estate transfer tax here.
In that text, you will find useful information on calculation, payment methods, exemptions, and more.
Why absolute (100%) legal certainty does not exist
Once you are registered as the owner of a property — you are in a strong legal position.
However, this does not mean that tomorrow you won’t be sued by the seller’s ex-wife, claiming that, based on marital property rights with the seller, she is entitled to half of your apartment, or by some third party challenging the seller’s (debtor’s) legal actions.
The possibilities are endless.
That’s why it’s important to know from the start who you are dealing with.
P.S. If you are a foreigner looking for comprehensive legal support with real estate and business matters in Croatia, you can find more information about collaboration opportunities here.
