Real Estate in Croatia Part III: Buying & Building Villas

Like many people from a cold climate, I've always dreamed of buying a villa on the Mediterranean someday. Two whole shelves of my home library are groaning under the weight of autobiographies ranging from the classic My Family & Other Animals where a British family moves to a succession of falling-down-but-utterly-delicious villas in Corfu, to Carol Drinkwater's olive farm trilogy where a British actress buys a run-down-but-utterly-delicious villa outside of Cannes France.

The books all shared a theme that foreign real estate may not be easy to find, but if you poke around with the help of a native guide, loads of adorable and just barely affordable old villas are there for the taking. (There's also an alternate story arc of "getting lost and finding nirvana" whereby while in France or Italy you take the wrong turn in a maze of overgrown country lanes and suddenly you find a big abandoned old farmhouse that everyone else has forgotten about. The natives think you're crazy to want to buy it; but when it's renovated, after a series of amusing adventures with local craftsman a la Peter Mayle, all your friends back home are violently jealous.)

Although I should have known better, my subconscious didn't, which led to disappointment. Although Croatia has olive trees, vineyards, and miles of sunny Adriatic coastline, the chances you'll find a beautiful old villa to buy are just about zero. Here's why:

Croatia is shaped like the letter "C" . The top half is all inland and high enough above sea level that it shares weather with Central Europe. This means snowy winters, grey springs, and hot sticky summers. There aren't many country villas or large picturesque farmhouses because most wealth was sent off as taxes to the Austro-Hungarian empire which ruled the area. Currently aside from a handful of larger towns (Zagreb, Ogulin, etc.) central Croatia is hilly, 3/4rds empty, agricultural and forested land and it's frankly a bit depressing because nearly everyone who could has left for someplace else such as Zagreb, Germany, Serbia or the Dalmatian coast.

The bottom half of the "C" is the famous bit you see in travel magazines with rocky coastline, strong sun, lots of islands, and sea views. It starts in the north with Istria and goes all the way down south to Dubrovnik. This is where one would expect to find lots of old villas... but you won't.

Why? History and geography. The coastline is awfully long - hundreds and hundreds of miles. But it's extremely steep, there's not much flat land. The hillside land is very rocky and often windy -- not a great place for agriculture. You can have a few sheep and some olive trees and that's about it. It's also awful for road-building. So historically, almost no one lived on the coast at all except for a handful of larger towns with decent harbors for shipping and just enough farmland to sustain the urban population such as Split, Rejika, Zadar and Dubrovnik.

The rest of this long, winding coastline and hundreds of islands was inhabited by the few poor peasant farmers, fishermen, and sheep herders who could manage to scrape a living. What wealth there was, was mostly drained off and sent to Italy which owned much of the Croatian coastline and harassed the rest. Many beautiful villas in Venice were in part paid for by Croatian taxes and built with wood from Croatian trees.

Lastly, wealthy Central Europeans from inland, who might have wanted to build lovely vacation villas by the Croatian Adriatic, could not because there weren't any decent roads over the mountains to the coastline or along the coastline itself until the 1950s.

When Tito's government invested in these new roads, loads of Croatians immediately flooded down to live or vacation on the coastline. (This is why you'll meet so many Zadar "natives" who have family land inland.) Plus, fed up with generations of isolation and poverty, the coastal natives left their small stone farmhouses and villages for apartments and jobs in larger towns as soon as they could as well. (That's why so many stone ruins are for sale on the islands.) Rapid building in coastal towns started in the mid-1950s and hasn't stopped to this day. For example, Zadar's population went from at most 15,000 in 1960 to 77,000 today and it's expected to hit 100,000 in a few years.

However, until the past decade, all of this new development was organized by a socialist/communist government. This means a tiny handful of concrete villas for top party officials (many of which cannot legally be sold to anyone) in downtown locations, and concrete apartment buildings for everyone else.

That's why any villas for sale on the Croatian coastline today are nearly always new construction, built as an investment (and sometimes for money laundering) to profit from wealthy western vacationers.

As I've mentioned in other posts, the buildings are cheaply made from concrete and concrete blocks using Bosnian labor. They range from fairly shoddy to good quality, depending on the business philosophy of the investors. You have to really inspect them well and ask a lot of construction questions. (We've seen new buildings next to each other where one is fantastic and the other terribly built.) Concrete isn't always a bad thing -- thicker walls regulate temperature extremes nicely.

You'll probably get a swimming pool, a terrace and a balcony or two. But you won't get any land for the types of old extensive gardens or vineyards that typically surround villas elsewhere in the Med. The villas are built more like suburban subdivisions, with as many squeezed into a development as possible to share the infrastructure costs of new electric, water, roads, etc. You also won't get many neighbors who are locals - so you won't have that "getting drunk with your new friend the farmer next door" experience so many expats living in France write about. Holiday villas and apartments tend to be ghettoed in areas with nothing but lots of other holiday villas and apartments.

These are generally near or on the water. However that doesn't mean there's a nice beach. I've never seen what I would consider a real "beach" in Croatia, aside from a few bits with a thin strip of sand. The coastline is abrupt and rocky. So much water comes down from the snowy hills that some coastal waters are unusually cold year-round. If you care about swimming in the ocean then check the local water temperature for yourself before buying.

In summary, if you want the old-fashioned villa of your dreams in Croatia, chances are you'll have to build it yourself. Building is often cheaper than buying, so it can be a great idea. A few tips if you're considering building:

For the past 60 years the government has carefully regulated where villas and apartment blocks could be placed. Much of the coastline is completely off limits - it's the "people's property" held in trust for the pleasure of future generations. So, places you might expect villas are verboten.

Some places, such as Zadar's famed Kolovare neighborhood, allow building villas but regulate how much land you must own per square meter of building so there's plenty of greenspace. This can make building cost prohibitive because you'd have to pay $600,000 for enough land for a small villa. Often natives build on a too-small piece hoping that they can pull strings to get away with it, or that nobody in city hall will force them to tear it down for a few years. Just because someone else has gotten away with breaking regulations does not mean you will. Always ask about zoning before buying anything!

Also, local governments are very careful about building permits. (Note: This is in marked contrast to Montenegro which is becoming increasingly unlovely because if you have enough cash you can build any damn thing you want; and lots of mainly Russians do.) I've met Croatian locals who have waited two years or more for their building plans to be approved by the town hall, even in smaller villages. Again, some will go ahead without permission, but then they may be forced to tear the new building down.

Other parts of the coastline are empty because no one's invested in infrastructure to be able to build houses. If you are a back-to-the-land type who likes the idea of solar panels, wind power and digging your own well, etc., then go for it. (However, buy the solar panels outside of Croatia because they are prohibitively expensive there.) Currently, only Croatian citizens can buy land in Croatia. With a bit of legal finagling, foreigners can buy houses, run-down stone farm buildings, or flats. or they can rent land for 100 years. Don't assume town services including garbage pickup, groceries, cable TV or Internet will get out your way anytime soon. The pace of development outside certain areas is glacial.

If you plan to live on your villa year-round or during the months Dec-March, then be sure to visit the prospective spot for an extended period during winter before building or buying. Although the Croatian coast is remarkably sunny and fairly warm all winter, the wind can be absolutely miserable. Natives have even given the winds names. You won't want to go outside, you won't want to get out of bed! Just because it's warmer and brighter than your home in the north, doesn't mean it's nicer to be outside.

If you want to garden and grow anything besides olives and grapes, you have to either buy a bit of land that's already farmed or assume there's not enough soil for farming so you'll have to do raised beds and truck in soil and compost. Don't assume that because your neighbors have gardens that you'll get good enough soil for gardening. I know of tiny yards in Zadar where every bit of soil was laboriously brought in by hand or created from decades of composting. Also, although you'll see palm trees and other sub-tropical plants, it does get below freezing on the worst winter days, even in Dubrovnik. ( I know, I just froze there two weeks ago personally.)

Lastly, basic building materials are fairly cheap but you won't find artistic or high end tiles, fixtures or furniture for reasonable prices. It's fairly easy to bring in what you want from other parts of Europe and even the US via shipping container to Rijeka, (there's also a regular car ferry between Zadar and Ancona in Italy where there's an Ikea) remember, you will pay customs on everything so stuff will end up being more expensive than you thought.

If you know someone who is an expat Croatian there are currently special low and no customs deals for expats returning home again. So look into that loophole - luckily I have Croatians in the family so I'm all set!