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If you have managed to find the appropriate real estate, we can help you with some useful pieces of information:
- A non-Croatian citizen can possess a real estate according to the regulations of legal force.
- After receiving the whole purchase price, the fact of the sale and purchase is annotated on the property sheet in the Croatian Land register or by the authorised local court in Croatia.
- In Croatia the final registration of the property has to be licensed by the Croatian Ministry for Foreign Affairs. The administration can take even a year due to the high number of necessary documents.
- After getting the licence of foreign affairs, the authorised land register or local court registers the fact of final property.
- For the registration process the buyer has to pay 5% property duty to the Croatian State.
The purchase of the real estate seems to be very easy: you have noticed a wonderful house right at the seaside, with an extraordinary view to the sea … You are fascinated with the view, you have even managed to reduce the price by € 1000-2000, and you decided to sign the sales contract with the seller. However the transaction is not finished at all having signed the sales contract in front of the notary and having paid the purchase price. If you were not careful enough the real problems start just then…
Namely, the purchase of the real estate does not finish by signing the contract. It is final only if you are registered as the new owner in the land register, based on the contract signed by you. If you have not made any preventive steps, that are necessary to do the job right, the next scenario can be very unpleasant: starting by that fact you may not be registered in the land register as the new owner, which means the lost of your property. And what is more, excavators sent by the state may appear one day to pull down the building.
Consequently, first you need to make sure whether the person that claims to be the owner is the real owner, or a person authorised by the owner. There are still a lot of real estates which lack property sheets showing the actual property rights, and the land register might show names of owners that died one hundred years ago. It is possible, that nobody questions that the 'seller' has property rights to the real estate, but you have to understand that such seller cannot act legally as a seller, as formally he or she does not possess the real estate. Therefore, you cannot be registered as the new owner.
By simply having a look at the land register, you cannot find out who the registered owner of the real estate is, and whether the real estate is restricted or mortgaged. It can turn out after the purchase of the real estate that it is mortgaged or restricted any other way. To buy a real estate that is mortgaged can be a good business, if you do it in a professional way, making sure that both parties are legally protected.
There is one more very important thing in case of buildings: the building permit. Have you checked whether your apartment or house has a building permit? How do you know that it has not been built illegally? You definitely have to ask the seller to show the building permit. If the building permit exists, do one more step: fetch the ground-plan that is a supplement to the permit, and check the size of the base, then go and measure the base yourself. Then check how many floors the building has, otherwise it might turn out that you bought an apartment on the third floor and the building was licensed to have only two floors. If the actual size of the base is the same as it was shown in the building permit, then you do not have to worry. If the building is larger than it was licensed, then you should not buy it, as the penalties are drastic: illegally constructed buildings, that cannot be legalised – as it might not be in the building zone, or the size of the building is larger than it was originally set by town and country plan that is necessary for the legalisation process, or the building has a building permit but its actual size is larger than it was licensed, it will have to be pulled down.
In case of buying a building site, the same warnings are valid that was mentioned in relation to the property rights and the possible restrictions to it. Besides, it is also important that the town and country plan should be checked at the local government, whether it is allowed to build anything on that site, and if yes, what can that be. Namely, if in the town and country plan your estate was not planned to be a building site, then nothing is allowed to be built on that site. If the site is in the building zone, then you have to check by all means what building operation it is licensed for: family houses, residential constructions, industrial areas, buildings for commercial/ touristic purposes etc. As if an area is set to be a zone for commercial/tourism purposes, then it is not possible to build family houses there and vica versa.
Of course you can reduce the risk by commissioning professional offices to do the business. But we have to warn you that in Croatia there are a lot of real estate brokerage offices, at the same time there are no rules that would regulate who and under what conditions can open an office, who can work there, what qualification he or she needs to have. In this difficult situation it is hard to give any advice which agency to work with, or not to work with. Maybe a recommendation from your acquaintance, friend or relative can be a good start. According to the result of a research study, three persons are informed about a successful transaction, while about a negative one at least seven. |
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