Housing loans for foreigners / mortgage for EU citizens

Download directly the housing loan offer for a Mali Kosi Seaview villa

We waited before posting this information, and we needed to test the information given to us, but we can now announce that Erste Bank, one of Croatia's largest banks, with its holding listed at the Vienna stock exchange, is offering housing loans to EU citizens who wish to buy a property in Croatia.

The product 'Erste Housing Loan for foreigners', in short

• interest rates: ca. 6,5 - 7 %
• amount of loan possible: up to 100% of property price
• repayment period: 20 years 
• type of loan: annuity (fixed monthly payment, including a part re-payment and a part interest)

Download the full mortgage conditions here

Our findings and advice, in short

• Current interest rates are still high in comparison to EU rates. As soon as Croatia enters the EU we expect that rates will lower as a result of direct competition from other foreign banks on the Croatian market. 
• A 100% loan demands an deposit (on a blocked bank account) from the client. Effectively, it is wise to take a maximum loan of 70% of the property price, in such case there is no deposit demanded by the bank. 
• attached calculation show that, when one chooses a loan of 50% of the purchase price, the costs of the mortgage are still less than the profit from renting out. This, particularly, makes your second home an interesting investment where the rental business pays for the costs.
• Take into consideration that the domestic en international (second homes) markets are two different things in Croatia. The prices of coastal real estate are subject to international demand, rather than from domestic demand. The easier availability of mortgages for foreigner will have a positive effect on those house prices.

Mali Kosi Seaview Villa Project

For the Mali Kosi Seaview villa's we have calculated an example situation. A 3 bed room villa with full sea view can be purchased for EUR 263.000. Including all purchase costs, and making use of a housing loan from Erste Bank for 50% of the purchase price, an investment is needed of only EUR 150.000

own investment needed for purchasing a 3 bed room, sea view villa: EUR 150.000

annual rental income: EUR 23.000
annual costs (incl. mortgage costs+re-payment): EUR 20.500
annual profit: EUR 2.500

Download the complete loan offer for a Mali Kosi Seaview villa


Invest now in Croatia, right before the country enters into the EU (2013; set date for EU entry)!

please send me the full details

Croatia tourism figures up in 2011

(AFP)
ZAGREB — Croatian tourism is on track for a record-breaking year, with an eight percent increase in visitors since January, the tourism minister said Wednesday.
"If we talk about numbers of visits and overnight stays, this is certainly the most successful year in Croatia's tourism," a key segment of the Adriatic country's recession-hit economy, Tourism Minister Damir Bajs told national TV.
During the January-July period 6.2 million tourists visited Croatia, ministry figures showed, an eight percent increase on the same period in 2010, or an extra 450,000 tourists.
In July alone, some three million tourists were recorded in Croatia, 4.8 percent more than the same month last year.
Tourists accounted for 19.8 million overnight stays, a 3-percent increase compared with the same period in 2010.
Last year 10.6 million tourists visited Croatia, mainly enjoying the Adriatic coast in July and August, while tourism-generated income stood at 6.24 billion euros ($8.9 billion).
The tourism industry makes up around 18 percent of the country's gross domestic product (GDP).
After a continuous rise in tourist numbers since the end of the 1991-1995 war, Croatia registered a fall of 2.5 percent in 2009 when the country fought a recession.
Despite improvements last year, it has since then only seen quarterly growth once -- 0.3 percent in the third quarter of 2010.
The former Yugoslav republic is set to join the European Union in mid-2013.