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Real Estate Due Diligence in Croatia

Real Estate Due Diligence in Croatia

Updated on Sunday 02nd February 2020

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The real estate due diligence is a legal investigation of a property and of the person who owns it, prior to the rental or the acquisition of the respective property. Our Croatian law firm offers due diligence services to persons intending to rent or buy properties in Croatia as well as to owners who want to rent or sell their properties in this country. If you want to open a company in Croatia and need a property, please feel free to address your inquiries to our team of lawyers in Croatia for legal assistance.
 

Real estate due diligence procedure in Croatia

 
Regardless whether you want to buy a property as a citizen or as a Croatian company, the due diligence procedure is meant to protect you and your company from the risks implied by the investment in a Croatian property. Depending on your particular requirements, our attorneys in Croatia can:
 
  • identify your objectives related to the real estate investments;
  • gather all the needed information on the property of your choice;
  • check the potential hidden risks of the property in Croatia;
  • verify whether there is any restriction on reconstruction interventions;
  • establish the terms and the financial aspects of the property acquisition;
  • elaborate the specific documentation for the transfer of property.

 

When do I need real estate due diligence in Croatia?

 
If you are looking to buy a property in Croatia, whether for business purposes or for personal matters like owning a house in this country, it is best to solicit real estate due diligence procedures. Our Croatian lawyers are at your disposal with the needed legal support. They can also help you register for VAT or obtain the EORI number.

 

Checklist items for real estate due diligence in Croatia

 
In respect of the due diligence service, our law firm in Croatia is following a comprehensive checklist, thus providing in-depth analyses of the real estate. The topics under focus are:
 
  • the confirmation of the location and of the boundaries;
  • the verification of the region, surroundings, and neighbors in order to realize a realistic picture of the property;
  • envisioning a funding strategy and setting up the legal context for a bank loan;
  • checking the willingness to pay or to sell of the contracting parts;
  • the elaboration of the lease or sale-purchase contracts;
  • checking up the legal record of the property and of the owner in order to prevent any litigations;
  • appraising the financial aspects regarding utility and maintenance costs;
  • finding the most suitable insurance for the property and the calculation of insurance costs;
  • the inspection of the building premises, such as parking lots and gardens with the help of a specialist;
  • verifying whether authorizations of any type are required.

 

 Our attorneys in Croatia can offer you independent legal advice regarding mortgage and effective help in the elaboration of the loan documentation. 

 

What do you need to know about a real estate due diligence in Croatia?

 
Our team of lawyers in Croatia can help entrepreneurs from abroad understand the rules and also the risks that might occur during a property acquisition. In this stage, the real estate due diligence is extremely important as it can reveal if there are problems with the licenses or the contracts involved. We can check the agreements of property owners and find out if all the terms and conditions respect the applicable laws. Real estate due diligence is necessary if you decide for large property acquisition in Croatia. A professional expertise before any real estate purchase is mandatory, especially if you are a foreigner looking to start a business in Croatia and need to buy an office space.
 

In-depth real estate due diligence in Croatia

 
Our real estate due diligence services in Croatia are varied and can comprise a topographical verification of the land you intend to build on and discussions with the local contractors and electricity suppliers to see if everything is in the right order from this point of view.  The registered documents of the property can also be verified with the entitled authorities, in order to see if there are any litigations involved or not. Also, such documents can show the occupation coefficient of the land, so that the buyer can estimate how much land can be used for future constructions. A real estate due diligence process can be complex and prolong, but if you discuss with one of our Croatian attorneys, you will receive the much needed support in this area, especially if you are a foreign buyer and you do not know the specific legislation. All your questions in terms of real estate due diligence can be handled by our experienced lawyers in real estate due diligence in Croatia.
 

What is a technical due diligence?

 
A real estate due diligence is comprised of varied steps, among which the technical ones can be of high importance. For instance, a technical due diligence might show that the property you wish to acquire needs some specific repairs, fire protection, structure and technical equipment, or it is necessary to solve and eliminate some environmental risks. In the latter situation, our team of lawyers can propose you an environmental due diligence, particularly if you wish to buy a large property or building. This means that a complete review of the location characteristics is made, alongside risks related to flooding, soil contamination, lighting or dangerous materials used in the building. Such aspects can only be discovered with the help of a technical due diligence procedure which are not only necessary, but recommended before any property acquisition is made.
 

Is it necessary to ask for real estate due diligence services?

 
Yes, if you are a foreign entrepreneur who wants to purchase a property in Croatia and need to know as much as possible about the building, it is recommended to have in attention the real estate due diligence services which can be provided by our team of lawyers in Croatia. No matter if you are a local or a foreigner, a real estate due diligence procedure is highly recommended because the report will reveal if the property you want to acquire is in good shape from a legal point of view. There are many persons who discover varied problems after a property purchase, issues that were never discussed, especially when the transaction took place. Hidden matters can be easily revealed by a real estate due diligence, or on the contrary, the property can be clean from a legal point of view. Nevertheless, these aspects can only be shown by a complete verification made by a team of professionals. This is our area of expertise when it comes to real estate due diligence procedures, so we remind that we are at your service of you are interested in this matter.
 

Choosing our real estate due diligence services in Croatia

 
The experience in this field is our business card, especially when it comes to foreigners who do not know the legislation in Croatia nor the property market. An accurate valuation or a correct report about the property a person wants to buy should be the first in the attention, especially to get rid of concerns regarding the status of the building, land, apartment, structure, etc. This is where the legal support of our team of lawyers in Croatia enters the discussion, as our specialists have enough experience to commence and conclude a real estate due diligence if requested. It is a well-known fact that a real estate transaction is quite complex and it involves a series of documents and verifications which cannot be entirely handled by the future owner. Instead of dealing with the complicated procedures of property verification and related things, it is best to hire the services of our local team of lawyers in Croatia who is experienced in real estate due diligence.
 
Below you can find interesting information about the real estate field in Croatia:
 
1. In 2018, the average price per square meter was around HRK 12,749 (approximately EUR 1,726), in Zagreb.
2. The VAT rate for property transactions in Croatia is 25%.
3. There are approximately 70,000 foreigners who own properties on the Croatian Adriatic Coast.
4. Around 55% of of approved permits for foreign acquisitions were granted to Germans.
5. Istria, Split-Dalmatia, Dubrovnik-Neretva and Zadar are top Croatian destination for foreigners willing to buy properties in this country.
 
 

Please contact our Croatian law firm for a risk-free transfer of property in this country and for a proper due diligence investigation.