- by croatiaweek
- May 3, 2026
-
in
News
Croatia’s property market continues to face high prices alongside a notable slowdown in activity, with the latest data showing a significant drop in the number of transactions. At the same time, regional price differences remain pronounced, raising ongoing questions about where investment still makes sense.
According to recent analysis, the number of property transactions has fallen by up to 20% at certain points, confirming a clear cooling in market activity.
Despite this decline, prices have not followed the same downward trend and have instead continued to rise, largely due to limited supply.
Officials highlighted on the latest edition of HRT show Otvoreno that the availability of new properties remains constrained by spatial planning regulations, project pipelines and building permits. This structural limitation has prevented any meaningful expansion in supply, sustaining upward pressure on prices even as demand softens.
Market data also reveals changes in the structure of transactions. Agricultural land accounts for the largest share by volume, making up around a quarter of all deals.
However, flats and apartments dominate in terms of value, representing roughly 45% of the total, despite a year-on-year drop of around 10% in transaction value.
Overall, estimates suggest approximately 117,000 property transactions were recorded, marking a decline of about 13% compared to the previous year. However, trends vary significantly across regions.
The sharpest drop has been seen in Istria, while coastal regions such as Primorje-Gorski Kotar have experienced milder declines. In contrast, some areas, including Split-Dalmatia County, have recorded notable growth in activity.
A key factor behind the slowdown is the reduced presence of foreign buyers, who traditionally account for a substantial share of demand, particularly along the coast. Foreign buyers made up around 30% of residential property purchases last year, mainly from Slovenia, Germany and Austria.
However, demand from these markets has weakened, partly reflecting broader economic challenges, including recessionary pressures in key European economies.
Domestic demand has also slowed, influenced by high prices and affordability concerns. Buyers are broadly split between those seeking housing solutions and those investing in property, with both groups now facing tighter financial conditions despite relatively low interest rates in recent years.
Affordability remains a pressing issue, particularly in coastal areas and Zagreb, where prices are highest. By contrast, continental regions offer relatively better affordability, although incomes are generally lower.
The greatest pressure is felt by residents reliant on salaries rather than tourism-related income.
Looking ahead, new legislative changes aim to further regulate the market, including stricter rules for property advertising and intermediary practices.
While these measures are expected to improve transparency, experts agree that without a significant increase in supply, there is little indication that prices will fall in the near future.
