Should you buy island property in Croatia?

Authored by the expert who managed and guided the team behind the Croatia Property Pack

Everything you need to know before buying real estate is included in our Croatia Property Pack

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INVESTROPA

A team specialized in real estate investing in European countries

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Croatia. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At INVESTROPA, we explore the Croatian real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Zagreb, Split, and Dubrovnik. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthiness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

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Nikki Grey 🇬🇧

CEO & Director, Europe Properties

Nikki Grey, an expert in European real estate markets, has deep knowledge of Croatia's growing investment potential. As the CEO of Europe Properties, she connects investors with prime opportunities in Croatia's dynamic property sector. From historic coastal towns to modern developments, her expertise ensures seamless transactions for buyers seeking homes or investments in this stunning Mediterranean destination.

What's the current price per square meter for island property in Croatia?

As of September 2025, Croatian island property prices typically range from €1,500 to €3,500 per square meter.

Prime locations on Hvar Town command around €5,000 per square meter, making it one of the most expensive areas in Croatia. Brač island averages approximately €3,000 per square meter for properties in desirable locations.

Smaller, less touristy islands offer significantly lower prices, with older properties or inland plots starting from just above €1,000 per square meter. Some remote areas or properties requiring renovation can be found for even less, particularly on islands with limited ferry connections or tourist infrastructure.

It's something we develop in our Croatia property pack.

How much more expensive are popular islands like Hvar or Brač compared to smaller ones?

Hvar is approximately 2 to 4 times more expensive per square meter than non-prime islands.

Hvar Town properties average around €5,000 per square meter, while Brač averages €3,000 per square meter in high-demand villages or seafront locations. In contrast, smaller or less touristy islands typically range from €1,000 to €1,500 per square meter for older houses.

Building plots on smaller islands can start from as low as €150 per square meter, compared to prime seafront plots on Hvar that can exceed €1,000 per square meter. The price difference reflects the significant gap in tourist demand, infrastructure quality, and accessibility between these destinations.

Premium locations on smaller islands can still command higher prices, but they rarely exceed €2,000 per square meter even in the best spots.

What are the annual property taxes and fees, and how do they compare with mainland property?

The 2025 property tax reform established annual rates ranging from €0.60 to €8.00 per square meter, set by individual municipalities.

A standard island property typically incurs around €1,200 per year in property taxes. For example, Krk Island rates typically range from €2 to €4.50 per square meter. Prime properties on Hvar or Brač can expect annual tax bills between €800 and €1,600 or more, depending on the property size and municipal rates.

Island and mainland properties now use similar tax calculation formulas, but municipal rates may be higher on tourist-heavy islands due to increased infrastructure demands. Additional fees include a tourist rental supplement of €150 to €300 per bed yearly if the property is used for short-term letting.

These taxes are generally comparable to mainland rates, with variations primarily based on municipal policies rather than island versus mainland location.

Can foreigners legally buy island property in Croatia, and what paperwork is required?

EU, EEA, and Swiss citizens can buy Croatian island property without restrictions, enjoying the same rights as Croatian nationals.

Non-EU buyers need approval from the Ministry of Justice and must prove reciprocity (that Croatian citizens can buy property in their home country). The approval process typically takes 2-4 months and requires additional documentation.

Required paperwork includes a notarized purchase contract, land registry extract, zoning certificate, proof of citizenship, and a Croatian tax number (OIB). Remote purchases are possible through power of attorney, allowing buyers to complete transactions without being physically present in Croatia.

EU property ownership does not automatically confer residency rights, but it does allow registration for stays exceeding 90 days. All foreign buyers must obtain an OIB tax number before completing any property transaction.

How much do legal fees, notary costs, and agent commissions add to the purchase price?

Total transaction costs typically add 6% to 10% to the property purchase price.

Fee Type	Rate	Notes
Real Estate Agent Commission	2-5% + 25% VAT	Usually negotiable, paid by seller but often factored into price
Legal Fees	1-1.5% + VAT	Sometimes negotiated as flat fee for simpler transactions
Transfer Tax	3% of price	For resale properties; VAT applies to new builds
Notary/Court Registration	€30-€200 total	Plus €20 per notarized signature
Administrative Costs	€200-€500	Various certificates and document fees

Real estate agent commissions are typically negotiable and may vary based on property value and complexity. Legal representation is highly recommended for foreign buyers to navigate local regulations and ensure proper title transfer.

What's the realistic rental income potential during summer season?

Peak summer weekly rents range from €1,000 to €4,000+ depending on property type and location.

Prime villas on Hvar or Brač can command €3,000 to €4,000+ per week during July and August. Typical sea-view apartments generate €1,000 to €2,500 per week during peak season. Smaller island properties or those without sea views typically rent for €700 to €1,500 per week.

Peak occupancy rates during July and August range from 75% to 90% for well-managed properties in prime locations. The full rental season typically runs 12 to 16 weeks from mid-June through mid-September, with reduced demand and rates outside this period.

Winter occupancy can drop to as low as 20%, making island properties primarily seasonal investments. Properties on smaller islands may achieve only 8 to 10 weeks of peak season rentals due to limited accessibility and tourist infrastructure.

It's something we develop in our Croatia property pack.

What are the average yearly maintenance costs for island properties?

Annual maintenance and management costs typically range from €200 to €1,000+ per year for island properties.

Property management fees for non-resident owners range from €200 to €800 annually, depending on property size and amenities like pools. Larger or more complex properties can incur €1 to €3 per square meter per month in management costs.

Ongoing utility costs include electricity at €0.11 to €0.15 per kWh, water at approximately €2 per cubic meter plus monthly connection fees, internet at €30 to €45 per month, and TV license at €10.62 monthly. Caretaking services for vacant properties add another €500 to €1,000 annually.

Island properties often face higher maintenance costs due to salt air exposure, potential water supply issues, and limited access for repair services. Emergency repairs can be significantly more expensive due to ferry transportation costs for materials and labor.

How reliable are ferry connections, and what's the travel time to mainland?

Ferry connections to major islands are generally reliable year-round, with travel times ranging from 30 minutes to 2 hours depending on the destination.

Hvar to Split takes approximately 1 hour with frequent daily crossings during summer (10+ per week) and reduced winter service (3 per week). Brač to Split car ferry runs approximately 1 hour with year-round frequent service. Ferry fares typically range from €10 to €20 per person.

Inter-island connections between Hvar and Brač take 30 to 46 minutes with regular summer service but significantly reduced winter schedules. Weather delays are possible during winter storms, but major islands maintain essential connections throughout the year.

Smaller, less touristy islands may have limited ferry service, particularly in winter, with some routes operating only 2-3 times per week during off-season. This accessibility factor significantly impacts both property values and rental potential.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in Croatia versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

What's the cost of utilities and are there frequent service disruptions?

Monthly utility costs typically range from €70 to €200, depending on property size and seasonal usage.

Electricity and water services are generally reliable on major islands, though some less developed areas may require water tanks or experience occasional short outages during heavy storms. Internet service costs €30 to €45 per month with decent speeds in larger towns, but remote areas may have slower or less reliable connections.

Water costs approximately €2 per cubic meter plus monthly connection fees, while electricity ranges from €0.11 to €0.15 per kWh. Some properties on smaller islands may need to rely on wells, cisterns, or water delivery services, which can increase costs significantly.

Service disruptions are most common during winter storms, but infrastructure on popular tourist islands like Hvar and Brač is generally well-maintained. Backup systems for water and power are recommended for properties in remote locations.

How easy is it to renovate or build on islands, and what are construction costs?

Construction and full renovation costs range from €1,500 to €2,500+ per square meter as of September 2025.

Building regulations have become stricter in 2025, requiring proper project permits and often involving facade or heritage restrictions, particularly in historic coastal areas. Only designated building land (not agricultural) can be developed, and permitting processes may take longer than on the mainland.

Luxury or prime seafront properties command higher construction costs due to specialized materials and stricter environmental regulations. Material transportation costs are higher due to ferry logistics, and skilled labor may be limited on smaller islands, potentially extending construction timelines.

Renovation projects often uncover unexpected issues like structural problems or the need for updated utilities, which can significantly increase costs. Heritage properties may require specialized materials and techniques, further increasing expenses.

It's something we develop in our Croatia property pack.

What are the biggest risks when buying island property?

The primary risks include coastal erosion, legal ownership disputes, and potential restrictions on short-term rentals.

1. **Coastal erosion and flooding exposure**: Some island plots face environmental risks requiring thorough due diligence on sea level rise and erosion patterns. 2. **Legal ownership disputes**: Unregistered ownership, unclear property boundaries, and inheritance claims on older properties are common issues that can lead to lengthy legal battles. 3. **Short-term rental restrictions**: Local municipalities may impose caps on new holiday lettings, particularly in tourist-saturated areas, potentially limiting income potential. 4. **Limited liquidity**: Island properties, especially on remote islands, can take significantly longer to sell and may require substantial price reductions to attract buyers. 5. **Infrastructure dependencies**: Reliance on ferry connections, utilities, and seasonal services can impact both property enjoyment and rental income if services are disrupted or reduced.

What's the average time to sell island property and expected resale value?

Island properties in prime tourist destinations typically take 6 to 18+ months to sell, depending on property type and pricing strategy.

Properties on Hvar and Brač generally sell faster than those on remote islands due to higher demand and better accessibility. Seafront and prime location properties maintain the strongest resale values, while older properties in remote villages often require significant negotiation and longer marketing periods.

Resale values are highest for properties in established tourist areas with good ferry connections and amenities. Properties requiring significant renovation or those in areas with limited infrastructure may sell at substantial discounts to their original purchase price.

Market illiquidity is a significant factor on smaller islands, where buyers may wait months or years for suitable properties, but sellers may also wait equally long for qualified buyers. Professional property management and maintenance during ownership can significantly impact resale value and marketing time.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Croatia Real Estate Insight - Ultimate Guide 2025
2. Terra Dalmatica - Real Estate Prices on Croatian Islands
3. InvestRopa - Croatian Islands Property
4. Marvel Real Estate - Tax Reforms Croatia 2025
5. CroReal - Real Estate Prices Croatia 2025
6. Adrionika - Cost of Living Croatia
7. Odvjetnik Basovic - Buying Property as Foreign Citizen
8. Owners Direct Croatia - Holiday Home Letting Guide
9. Ferry Hopper - Croatia Hvar Ferries
10. InvestRopa - Foreigners Buy Land Croatia