Croatia is implementing new legislation to curb the impact of short-term tourist rentals on housing prices and availability for local residents. The government aims to ease a "price squeeze" felt in popular tourist destinations by introducing new taxes and regulations, though some property owners express concern over potential business impacts.
Key Takeaways
- Croatia is introducing draft laws to regulate short-term tourist rentals.
- The measures aim to alleviate rising housing prices and shortages for locals.
- New taxes will be imposed on rental properties, but long-term housing will be unaffected.
- Some property owners fear negative consequences for their businesses.
Addressing the Housing Squeeze
Similar to other European cities like Barcelona and Budapest, Croatia is taking steps to manage the growing influence of short-term rental platforms on its housing market. The proposed laws, approved by parliament last week and awaiting further discussion and potential amendments, will increase taxes on houses designated for rent and the lump sum tax for tourist rentals. Crucially, these changes will not affect housing units occupied by long-term residents or those owned and lived in by individuals.
Local Support and Business Concerns
Many citizens in coastal towns like Split and Dubrovnik have voiced support for the new regulations, arguing that the proliferation of tourist apartments has led to a "hollowing out" of city centers, with fewer local businesses and residents. Zaklina Jurić of the "Tenants Together" initiative stated that the new laws acknowledge the issue of towns becoming deserted outside of the holiday season.
However, the tourism sector, which contributes significantly to Croatia’s GDP, is bracing for change. Approximately 125,000 people are employed in the home rentals business. Jurica Repinc, a rental agency owner in Zagreb, expressed concern that many property owners who invested heavily, often with loans, are now facing uncertainty. Klaudia Kapural, another apartment owner, criticized a provision requiring 80% of tenants in residential buildings to agree on rentals, deeming it difficult to achieve. Some anticipate that these changes could lead to a rise in rental prices by as much as 20% next year.
