Is buying a property in Lapad a good investment?

Last updated on December 7, 2023

Yes, the analysis of Dubrovnik's property market is included in our pack

If you've enjoyed the coastal atmosphere and scenic promenades in Lapad, Dubrovnik, you may have contemplated investing in a property here to make it your base for enjoying the Mediterranean lifestyle on the shores of the Adriatic Sea.

Is it a good idea though? How is the real estate market there? Are prices going up or going down? Do people make profits on their real estate investments? What about the rental demand?

We'll answer all these questions for you! When building and updating our property pack for Croatia, our team has been researching and surveying this area. Actually, lots of customers are interested in investing there. So we thought it would be a good idea to add some information about it in our pack.

Why do property buyers like investing in Lapad?

Lapad, a district in Dubrovnik, Croatia, has increasingly become a sought-after location for property buyers, standing out for several distinctive features in the real estate market.

What sets Lapad apart, primarily, is its blend of natural beauty and urban convenience. Unlike other areas in Dubrovnik, which may lean more towards historical charm or coastal allure, Lapad strikes a unique balance.

It boasts beautiful beaches and parks, making it a paradise for those who love the outdoors, yet it is also equipped with modern amenities and infrastructure.

The area's rise in popularity can be traced back to the early 2000s, a period of significant development in Dubrovnik following the Croatian War of Independence. Lapad's growth in the real estate market was fueled by its ability to offer both a serene living environment and proximity to Dubrovnik's vibrant Old Town.

This blend has continued to attract a diverse group of buyers, from retirees seeking a peaceful lifestyle to young professionals and families wanting a balance of nature and city life.

The people drawn to Lapad are often those who appreciate its quieter, more relaxed pace of life compared to the busier, more tourist-centric parts of Dubrovnik.

Additionally, its reputation as a safe and family-friendly area adds to its appeal. However, it's important to consider some potential drawbacks. The popularity of Lapad has led to a rise in property prices, which might be a barrier for some.

Furthermore, during peak tourist seasons, the area can become quite crowded, which might detract from its otherwise tranquil atmosphere.

While Lapad continues to be a popular choice, whether this trend will persist depends on various factors. The global real estate market, changes in tourism patterns, and local economic conditions all play a role.

However, given its unique offerings and ongoing developments, Lapad seems poised to remain a desirable location for the foreseeable future.

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Why is Lapad a nice place to live?

Lapad offers a lifestyle that balances the charm of Mediterranean living with modern amenities.

This district is known for its relaxed, yet vibrant culture, marked by outdoor cafes, parks, and scenic walking paths along the coastline. The lifestyle here is laid-back, with an emphasis on enjoying the natural beauty and historical richness of the area.

The expat community in Lapad is thriving, adding to the area's cultural diversity. Expats are often drawn to Lapad for its quality of life, beautiful surroundings, and the welcoming nature of the local community. This integration of different cultures contributes to a unique and enriching living experience.

When it comes to the cost of living, Lapad is generally considered more expensive than other parts of Croatia, primarily due to its popularity and location.

Property prices and living expenses can be high, but many find the quality of life justifies the cost. This is something to consider if you're planning a move here.

Safety is another strong point for Lapad. Dubrovnik, and by extension Lapad, is known for being particularly safe, with low crime rates. This sense of security is a key factor for families and individuals seeking a peaceful environment.

As for amenities and facilities, Lapad is well-equipped. You'll find excellent schools such as the Dubrovnik International School, offering an international curriculum. Healthcare facilities, including the General Hospital of Dubrovnik, provide quality medical care.

For shopping and leisure, the Lapad Bay area hosts various shops, restaurants, and cafes, ensuring residents have access to all they need.

The infrastructure in Lapad is robust, with well-maintained roads, reliable utilities, and strong internet connectivity, which is a significant plus in today's digitally connected world. This makes it an ideal location for those who work remotely or require consistent online access.

Accessibility is another advantage of living in Lapad. It's well connected to other parts of Dubrovnik and the surrounding areas, making it easy to explore the region.

The local bus service is efficient, with routes connecting Lapad to the Old Town and other key areas. For travel beyond the city, the Dubrovnik Airport, located about 22 km from Lapad, provides a gateway to international destinations.

Public transportation options in Lapad are quite satisfactory. The local bus network is the primary means of public transport, connecting residents to various parts of Dubrovnik efficiently. These buses run frequently, making it convenient to navigate the city without a car.

How much does it cost to buy real estate in Lapad?

If you need a detailed and updated analysis of the prices, rents and yields, you can get our full guide about real estate investment in Croatia.

Buying property in Lapad can be a significant investment, and understanding the market is crucial.

The area offers a range of residential properties, including apartments, houses, and luxury villas. The demand for apartments, especially those with views of the sea or in close proximity to the beach, is particularly high. These properties appeal to both investors looking for rental income and individuals seeking a serene place to live.

In terms of property types, you'll find both new developments and resale properties in Lapad. New developments are often modern apartments with amenities that cater to a luxurious lifestyle, while resale properties include older homes and villas, which have their unique charm and often come with a higher price due to their historical value.

The price range for properties in Lapad varies widely, depending on the type, location, and condition of the property.

Generally, prices can range from about €3,000 to €6,000 per square meter, with luxury properties and those with sea views commanding the higher end of this spectrum. It's important to note that these prices have been steadily increasing over recent years, reflecting Lapad's growing popularity among both local and international buyers.

Looking at the trends, property values in Lapad have been on an upward trajectory, influenced by Dubrovnik's overall growth as a tourist and expat-friendly destination. This trend is expected to continue, particularly if new developments and city planning initiatives are introduced.

For instance, any future enhancements in infrastructure, like improved transportation links or additional leisure facilities, could further boost property values.

Predictions for the real estate market in Lapad in the coming years remain optimistic. Factors like its desirable location, continued interest from foreign buyers, and its status as a UNESCO World Heritage city contribute to this positive outlook.

The ongoing development of high-quality residential projects also indicates a potential increase in property values.

For those considering investing in Lapad, it's essential to keep an eye on specific factors that could influence property values. These include the state of the global real estate market, tourism trends in Dubrovnik, and local developments in infrastructure and amenities.

While the market currently shows signs of growth, potential investors should also be aware of the dynamic nature of real estate and consider both current trends and future predictions in their decision-making process.

Where is the best area to buy a property in Lapad?

When considering the best area to buy a property in Lapad, it's essential to understand how different parts of this district offer varied atmospheres, property types, and pricing.

Lapad is a diverse area, and your ideal location will largely depend on what you're looking for in a home and lifestyle.

One of the most sought-after parts of Lapad is the area closest to the coastline, particularly near Lapad Bay. This area is known for its vibrant atmosphere, with numerous cafes, restaurants, and beaches. Properties here, mostly modern apartments and some renovated villas, offer beautiful sea views and easy access to the beach.

However, this desirability comes with a higher price tag, making it one of the more expensive parts of Lapad.

Moving slightly inland, you'll find areas that are quieter but still conveniently located. These areas typically feature a mix of older houses and newer apartment buildings.

The atmosphere here is more relaxed, and the properties are more affordable compared to those directly on the coastline. This balance of tranquility and accessibility makes these areas particularly appealing for families or those looking for a more subdued lifestyle.

For buyers interested in up-and-coming areas within Lapad, the neighborhoods around Babin Kuk and Gorica are worth considering. These areas have been seeing development in recent years, with new residential projects offering modern amenities.

The prices in these areas are generally more moderate but are expected to rise as the areas develop further.

If you're actively looking to buy a property in Lapad, focusing on the areas near Lapad Bay or the quieter, inland neighborhoods would be a good idea. The former offers a lively, coastal lifestyle with premium properties, while the latter provides a more laid-back living environment at potentially more affordable prices.

On the contrary, areas that are heavily trafficked by tourists, particularly during the summer months, might be less advisable for those seeking a peaceful residence.

These areas can be quite noisy and crowded, which might detract from the living experience, especially if you're looking for a year-round home.

Here is a summary table to help you visualize better. If you need more detailed data and information, please check our property pack for Croatia.

Area	Atmosphere	Property Types	Price Range	Suitability
Lapad Bay Area	Vibrant, close to beaches	Modern apartments, renovated villas	Higher	Those seeking lively coastal life
Inland Areas	Quieter, residential	Mix of older houses and newer apartments	Moderate	Families, relaxed lifestyle seekers
Babin Kuk and Gorica	Developing, modern	New residential projects	More moderate, potential to rise	Investors, those looking for modern amenities
Tourist-heavy Areas	Noisy, crowded in summer	Varied	Varies	Less suitable for year-round living

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Is there a strong rental demand in Lapad?

Lapad is experiencing a strong rental demand, and understanding its dynamics is key for potential property investors or landlords.

The demand in Lapad is predominantly for short-term rentals, largely due to Dubrovnik's status as a popular tourist destination. This trend is especially prominent during the summer months when tourists flock to the city for its beaches, cultural heritage, and the overall Mediterranean experience.

The target demographic for rental properties in Lapad is diverse. It includes tourists seeking vacation rentals, business travelers, and, to a lesser extent, students or professionals looking for longer-term accommodation.

Tourists often look for properties that offer convenience and proximity to attractions, while business travelers might prioritize comfort and connectivity, and long-term renters typically seek affordability and practicality.

In terms of property types, tourists and short-term renters usually prefer furnished apartments or villas that offer a sense of luxury and are equipped with modern amenities.

They tend to favor properties near the coastline, particularly in areas like Lapad Bay, where they can enjoy easy beach access and the vibrant local dining and shopping scene. On the other hand, long-term renters might lean towards more affordable, functional apartments that may be located further inland.

Amenities that can help reduce vacancy rates and attract tenants include high-speed internet, modern appliances, air conditioning, and, if space allows, parking facilities.

Properties that offer unique features like sea views, balcony or terrace space, or garden areas are particularly appealing. These amenities are crucial in catering to the needs and expectations of renters, thereby enhancing the property's attractiveness and reducing the likelihood of it sitting vacant.

Regarding potential returns on investment, properties in Lapad can offer attractive yields, particularly for short-term rentals.

While specific numbers can vary greatly depending on the property's location, size, and condition, landlords can expect higher returns during the peak tourist season. The annual yield can range, but properties in prime locations with desirable amenities often see better returns.

Lastly, the types of properties that are seeing increasing demand and could potentially yield better returns are those that cater to the short-term rental market. This includes well-located apartments and villas with modern amenities and unique features like sea views or proximity to tourist attractions.

As Dubrovnik continues to grow in popularity as a tourist destination, these properties are likely to remain in high demand, offering potentially lucrative opportunities for investors.

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Is it easy to buy a property as foreigner in Lapad?

Before we answer the question, please know that we have an article dedicated to the experience of buying real estate as a foreigner in Croatia.

Buying property in Lapad, Dubrovnik, as a foreigner can be a straightforward process, but it's important to be aware of the regulations, potential risks, and best practices involved.

Firstly, foreign buyers in Croatia, including Lapad, are subject to specific regulations and restrictions. For citizens of EU countries, the process is relatively unrestricted, similar to that for Croatian citizens.

However, for non-EU citizens, the process can be more complex. They are generally required to obtain approval from the Ministry of Justice, which can extend the purchasing process. This approval is typically granted if there's a reciprocal agreement between Croatia and the buyer's home country that allows Croatians to buy property there.

The purchasing process in Lapad involves several steps. After selecting a property, a buyer typically signs a pre-contract and pays a deposit. This is followed by the main contract, which is signed in the presence of a notary.

The buyer then pays the remaining amount and registers the property in their name. Throughout this process, it's crucial to ensure that the property has a clear title and all required documentation.

One primary risk associated with property investment in Lapad is navigating the legal and bureaucratic aspects of the Croatian property market. There can be issues with unclear property titles, particularly with older properties or those that have been passed down through generations.

Additionally, as in many tourist-centric locations, there's the risk of paying above market value if not adequately informed about local pricing.

Common pitfalls for foreign buyers often include overlooking the need for legal and bureaucratic diligence.

For example, failing to verify the property's legal status or not being aware of specific local regulations can lead to complications. A unique aspect in Croatia is the prevalence of 'zoning plans', which can affect future developments or property use; not understanding these can impact your investment.

Working with a local real estate agent and a lawyer is highly recommended. A reputable local agent can provide insights into the market, help find properties that meet your criteria, and guide you through the local buying customs.

A lawyer is essential for ensuring that all legal aspects are handled correctly, from checking property titles to navigating the approval process for non-EU buyers.

Common exit strategies for property investors in Lapad include selling the property for capital gains or renting it out, either for short-term holiday lets or long-term leases. The choice depends on the investor's goals and market conditions.

Given Lapad's popularity as a tourist destination, short-term rentals can be particularly lucrative, but they require active management and compliance with local rental regulations.