Mortgages for foreigners

It is still not a product widely offered in Croatia: mortgages for foreigners seeking to purchase real estate. Some stories are arising though right now. Hypo Alpe Adria has been offering the service for a year now against quite high non-competitive interest rates and demands. More banks are preparing as the new resorts and masterplanned communities are setting foot on Istrian and Dalmatian shores.

Once it becomes widely available this will have an enourmous effect on real estate trade. The year 2006 was a weak year with a total of real estate transactions matching a busy street in Amsterdam. Prices were mainly dictated by private property owners with no competition from international property developers. This caused a price rise of ALL real estate, good quality/good location as well as underquality real estate. 2007 is already showing a small stabilisation in this.

Next year mortgages will become widely available to foreigners. This aspect will boost the property demand in the upward direction. New properties will come on the market. This will most probably cause the prices to become more realistic in terms of price for quality. Good quality/location will keep rising, where as bad quality will find its good competitor, finally.

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