Real Estate Valuation

The valuation of real estate in the Republic of Croatia is regulated by the Real Estate Valuation Act, which was enacted on July 3, 2015, and has been in force since July 25, 2015.

The valuation of real estate must be conducted with the diligence of a competent expert, taking into account all available evidence to ensure that the result is sustainable upon verification.

Real estate valuation is used in property transactions, determining the value of collateral objects, property insurance, dissolution of co-ownership communities, investment and property value enhancement matters, encumbrance and depreciation issues, land development procedures, urban land consolidation, expropriation, and other land-related matters.

The valuation is based on general market value relationships on the valuation date and the condition of the real estate at the time of assessment. General market value relationships encompass all circumstances relevant to shaping the price of the property on the valuation date under normal business conditions of supply and demand, such as the general economic situation, capital markets, and the economic and demographic development of the area.

The market value of a property is the estimated amount for which the property could be exchanged on the valuation date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing, where both parties act knowledgeably, prudently, and without coercion.

When determining land value, the following factors are primarily considered:

– The existence of a well-defined spatial planning regulation governing land use
– Availability of public utilities and the development of infrastructure
– Accessibility of the land
– Proximity to other structures, roads, and infrastructure
– Land size and the overall development of the wider area
– Supply and demand for land at the given location

Real estate valuations can only be conducted by authorized persons: permanent court experts and permanent court valuers, who present their findings and opinions in a valuation report.

It has been stipulated that within 60 days from the enactment of the Act, a database called “eNekretnine” will be activated. In its initial phase, it will contain a collection of purchase prices accessible only to registered users. In the final phase, after data processing and evaluation, approximate value plans, i.e., price blocks, will be created and made freely available to all.