Long-term rental costs are surging in Croatia as Croatian property owners and overseas property investors move towards short-term holiday rents.
As Croatia becomes more and more popular on the tourist map, more property owners are pandering to the tourist trade, sparking a shortage of long-term rental availability during the summer season.
This has led to the price of long-term rental surging by as much as 30 per cent year-on-year when compared to the average cost in 2017 according to a report by the publication Poslovni Dnevnik.
A combination of apartments being rented to tourists and real estate sold to overseas property investors has made simply finding a place to rent long-term near impossible.
A real estate agent in Zadar commented to Poslovni Dnevnik: ‘Flats for year-round rent are very difficult to find, it’s mostly only for the period from October to June, when owners start doing short-term rents to tourists. So only students can rent, as the off-season suits them, and families have huge problems as they get kicked out of their flats when the summer season starts.’
The surge in rental cost is occurring in many places in Croatia, including Zadar and Dubrovnik.
An average two-bedroom apartment in Dubrovnik will now cost upwards of 600 Euros per month with larger ones starting at around 800 Euros.
With apartment owners seeking the obvious financial benefits of renting to tourists than the long-term security of renting, it is expected to have far-reaching effects.
Research assistant Marina Tkalec at Zagreb’s Faculty of Economy pointed out that the rise in rent and real estate prices can have multiple economic and social effects, as not only these shoot up the price of living in cities, they also affect personal choices people make in terms of education and employment.
With long-term rental yields obviously improving, it may be that some UK overseas property investors wish to look at the extra security for rental income that can be offered.
A long-term rental investment in Croatia could be a relatively hassle-free way of getting a decent yield on investment without the downtimes.