Croatian wheat producers are smiling all the way to the bank this year. In spite of serious heat waves, Croatian wheat crops are registering record high harvests this year. While this year the American crop industry finds itself on the verge of environmental catastrophy, rich Croatian lowlands are bringing in best quality harvest.
This year in three regions of Slavonija (part of Croatia well known for fertile ground and golden fields) registered record wheat yields of 9,5 tons per hectare. Favorable agroclimatic conditions, proper cultural practices and quality seeds of suitable varieties are few of the reasons cited to be behind the amazing numbers coming from Croatia.
Current Croatian average of 4,2 tons per hectare is certain to change next year. Plenty of fresh water sources will definetly propel this country’s agricultural sector to new highs in the near future.
According to The Croatian Ministry of Agriculture the crop yield brought in from approximately 166,615 hectares under crops this year will amount to 700 000 tonnes.
The country’s bakery and bread industry’s yearly requirments amount to 550 000 tons (some estimate more) so it is obvious that the rest will be destined for export.
The Croatian food producing giant Agrokor (20 000 hectares) this year planted 5664 hectares with wheat and is currently pulling in 8 tons per hectare.
Despite the drought and higher temperatures which have forced earlier harvest this year, the wheat is of excellent quality. Protein content is high and the humidity low. The rains in April and May this year saved the wheat crop. In some parts of the country where the rain was particularly heavy and the farmers have not protected their crops in time there were incidences of outbreaks of various crop diseases (blight).
The current purchase price is between 1.3 and 1.5 kunas per kilogram of wheat. An international crops export agency based in Zagreb (Croatia’s capital city) is currently offering high 1.55 kunas/kg of “Croatian gold”. Many cattle farmers are nodding in disbelief and are expecting high animal feed prices if the trend remains.
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Suid-Afrikaanse boere het vandag ‘n nuwe opsie om in Kroasië te belê en te gaan boer. Hierdie Europese land, alombekend vir sy pragtige eilandryke see, natuurskoon en sonnige klimaat is ‘n nuwe bestemming vir die Suid-Afrikaanse boer. Suid-Afrikaanse boere het reeds in baie ander lande soos Kanada, Argentinië, Nieu-Zeeland, ander Afrika lande en die voormalige USSR republiek van Georgië bele.
Dit is nou tyd om Kroasië ernstig te oorweeg.
Kroasië is ‘n middel Europese land wat volgende jaar (2013) by die Europese Unie (EU) aansluit. Wat beteken dit vir Kroasië? Dit beteken dat alle wette in lyn moes kom met EU wette. Korrupsie is hokgeslaan en die regstelsel is verbeter. Kroasië het ‘n vryemark ekonomie en buitelandse beleggers word presies dieselfde behandel as enige ander Kroasiër. Eiendomsregte word deur die grondwet beskerm.
Daar is eerste wêreld infrastruktuur, nuwe paaie, heelwat lughawens (waarvan 5 internasionaal), besige see en rivier hawens. Kroasië het ‘n strategiese geografiese posisie en fasiliteer die vervoer van goedere oos na wes en wêreldwyd.
Kroasië is redelik yl bevolk met die meeste van die 4.3 miljoen mense wat in die metropolitaanse gebied van die hoofstad, Zagreb, bly. Die kustelike gebiede het kleiner toeriste dorpe en die binneland is deurtrek met klein dorpies.
Die kultuur is Wes-Europees, die werksmag is jonk, baie goed geleerd en meestal tweetalig met Duits of Engels as ‘n tweede taal. Die westerse alfabet en metrieke stelsel word gebruik.
Daar is baie goeie gratis mediese sorg, skool en tertiëre onderwys. Dit is ook ‘n baie veilige land met ‘n uiters lae moord syfer, veral op die platteland waar dit ongehoord is.
Wat betref sport is sokker en basketbal mees gewild, maar rugby en krieket word op klyn skaal gespeel.
Landbou en grondbesit in Kroasië
Sedert die Balkaanse oorlog was daar baie min ontwikkeling van die landbou in Kroasië. Daar is huidiglik baie landbougrond wat ongebruik lê weens verskeie redes: Ouer boere, jongmense wat na die stede trek, gebrek aan geld en kennis om die landbou weer op die been te bring.
Daar is baie geleenthede in die landbou sektor so wel as fondse (Kroasië regering sowel as EU) waarvan gebruik gemaak kan word. Die moontlikhede is eindeloos:
Koop landbougrond en begin ‘n nuwe boerdery
Werk saam met plaaslike boere aan ‘n gesaamentlike projek
Belê in landbou projekte
Belê in voedsel produserings aanlegte
Koop ‘n bestaande plaas
Veeartsenydienste is op dieselfde vlak as die EU. Die plaaslike boere is gretig vir venootskap en dankbaar vir werkskepping.
Grondbesit was nog altyd belangrik. Met die toetrede tot die EU, net soos met ander nuwe lidlande, is Kroasië genoop om ‘n 7 jaar moratorium te plaas op die koop van plaasgrond deur buitlandse individue. In Kroasië was daar reeds so ‘n moratorium in plek. Ten spyte daarvan is daar baie buitelanders wat wel landbougrond gekoop het en suksesvol boer. Die metode wat gevolg word is om ‘n Kroasiese besigheid te registreer en hierdie besigheid koop dan die grond of plaas. Dit is heeltemal wettig en almal wen: Kroasie kry ernstige beleggers wat werk skep en belasting inkomste bring en die buitelanders, wat die eienaars van die besigheid is, is steeds die grondeienaars. Die beisgheid word dan deur die wet dieselfde beskou as engige Kroasiër, uit die oogpunt van grondbesit. Alle ander tipe eiendom kan vrylik sonder enige beperkings verhandel word.
Om ‘n Kroasiese besigheid te registreer is maklik en vinning. Die minimum kapitaal is HRK 200 000, wat onmiddelik gebruik kan word om bates aan te skaf. Tydelike verblyfspermitte word toegeken aan besigheids eienaars en na vyf jaar kan ‘n mens permanente verblyf kry. Daarna, na nog drie jaa,r kan burgerskap verkry word.
Huidiglik is landbougrond redelik goedkoop maar dit word verwag dat pryse volgende jaar, na die toetrede tot die EU, vinnig sal verhoog.
Geskryf deur: S. Hanekom
Today, South African farmers have a new option to invest and farm in Croatia. This European country, well known for its beautiful island-dotted sea, natural beauty and sunny climate, is a new farming frontier for the South African farmer. South African farmers have been investing and setting up operations all over the world in countries such as Canada, Argentina, New Zealand, other African countries and the former USSR Republic of Georgia.
It is time to have a good look at investing in Croatia.
Croatia is a middle European country which is set to join the EU in mid 2013. What does that mean for Croatia? It means that all Croatian laws had to come in line with EU laws. Corruption has been tackled and the judiciary overhauled. Croatia is a sovereign country with an open market economy. Foreign investors are treated the same as any other Croatian business person and property rights are protected by the constitution. Croatia boasts first world infrastructure, brand new road network, many airports (five international), busy ports (sea and river ports). The strategic geographical position makes Croatia a very important addition to the EU and facilitates any form of travel and exchange or transport of goods, both east-west and to the EU and the rest of the world.
Croatia is a sparsely populated country with most of its 4.3 million people living in the metropolitan area of the main city of Zagreb. Coastal areas are characterized by smaller tourist towns and the interior is scattered with smaller towns and villages.
The culture is West European, the labor force is young and educated and mostly bilingual with English or German as a second language. Croatia uses western alphabet and the metric system.
Croatia has a very good social system as well as government health, school and tertiary education. It is also a very safe country with an efficient police force.
Rugby and cricket are played in Croatia on a minor scale, soccer and basketball being the main sports. Good opportunity for South Africans to get involved and get the locals more interested in these sports.
Croatian agriculture and land ownership
There was very little development in Croatian agriculture since the Balkan war. There is currently a lot of prime agricultural land lying unused. The reasons are multiple: Older farming households, young people migrating to the cities, lack of investment, poor management and know-how. Croatian agriculture is in need of investment and know-how to bring it back to it’s former glory.
There are many opportunities in the sector, as well as many funds (Croatian and EU) to tap into.The possibilities are endless:
Buy agricultural land and start a business from the ground
join local farmers in a joint venture
invest in agricultural projects
invest in food processing facilities
buy an existing farm etc.
Veterinary services are on the same EU level of quality and so is the infrastructure. The locals are open to partnership and greatful for job creation.
Land ownership has always been an important factor and understandebly so. With accession to the EU, Croatia, as with previous new member countries, is required to place a seven year moratorium on foreign ownership of agricultural land by individuals. However, in Croatia today there is already a moratorium on the sale of agricultural land to foreigners. In spite of that there are many foreigners that have invested and are investing in Croatian agriculture and running very successful operations. How? The standard way is to establish a Croatian company which will then acquire agricultural land. Everybody wins, Croatia gains serious investors that create jobs and tax revenues and foreigners, who are the owners of the company, are still in possession of agricultural land. The Croatian company is considered by law the same as any Croatian individual from the point of owning agricultural land. All other types of property are traded normally without restrictions.
Establishing a Croatian company is an easy and automated process. Minimum capital is HRK 200 000 which can be used straight away towards purchasing the assets.
Temporary Croatian residency is available to business investors and in five years time you will aquire permanent residency which entitles one to use all the social services available to Croatian citizens such as schooling, healthcare, pension etc. After becoming a permanent resident of Croatia you will be able to obtain Croatian citizenship in another three years time.
Croatian agricultural land prices are currently low and there is a lot of space for bargaining but they are expected to rise next year after the accession to the EU.
Written by: S. Hanekom
Croatian real estate
Fertile ground for investors’ capital
Much has happened in the Croatian real estate market in the last few months. Big ticket buyers are back, joining in the rush for Croatian real estate before EU ascendency mid 2013.
While much of the world is ailing, trying to solve their economic woes, investors have found fertile ground to plant their capital and they won’t be sorry. Certainly not everyone can buy the national railways or the main Croatian harbour, but there is always something for everybody.
The Croatian economy is currently based on the hospitality sector with other sectors quickly catching up. Young Croatians are entrepreneurial, well-educated and great innovators. The recent invention of an electric supercar by 23-year-old Mate Rimac is an example.
Some people are musing that Croatian dependency on hospitality is a sure way to a second Greece. Our opinion is: the more the merrier! The Croatian hospitality sector should be and already is indirectly used as a vehicle to develop other sectors. It is important to allow the profit from the hospitality to remain in the country and let it trickle into other layers of the economy.
So why invest in hospitality? Croatia is a tourist mecca, welcoming 10 million visitors in 2011 and expecting another bumper season this year. The Croatian hospitality minister is expecting around € 933,8 milion to originate from the hospitality sector this year. Further good news for hospitality providers is that current VAT (25%) will be reduced to 10% for hospitality services in 2013, rendering the Croatian hospitality sector even more competitive.
There is still a lot of space to move by diversifying into still undeveloped hospitality sectors such as conference tourism, country and cultural tourism, food and wine, and boutique tourism.
Our advice for investors is to look at unique historical hotels. This type of property will always remain attractive and is impossible to recreate. There are also many small family-run hotels on fantastic positions that can be updated into five-star boutique hotels and branded as such.
However, we feel that the ultimate investment opportunity lies in purchasing non-functioning hotels in fantastic positions and transforming these ugly ducklings into swans! Country tourism is also a hospitality sector offering great opportunities for smaller and corporate investors.
Another wonderful opportunitiy for both smaller and corporate investors are the unique stone villas and estates. They may be 100 to 500 years old and are found in various locations, from the islands to the beautiful wine country of the Istrian peninsula. They can be purchased for as little as €30 000. The latest trend is to transform them into luxurious villas and then rent them out to visitors looking to escape the noise of the big city, at €300/400 per day. This can create a very good income stream.
Visitors often fall in love with the country and they would like to purchase real estate to have at their disposal when they visit. Some plan to retire here. This fact leads to a very good opportunity to develop themed estates: retirement, island, coastal, eco, wildlife, wine and country estates. Croatians are getting older and many have not planned for their retirement accommodation . Today retirement accommodation is in a chaotic state and Croatians need to be offered different options and solutions, creating plenty of opportunities for property developers.
Hospitality brings a lot of traffic to the country and directly affects other sectors of the economy. Visitors get to know the country, see the drive behind the hospitality industry and cash in on it.
Agriculture and food refrigeration, as well as food production and packaging, are sectors that are lagging behind and require investment. Croatia imports large amounts of food (for example, 80% frozen vegetables) while homegrown organic vegetables go rotten because of lack of warehousing and refrigeration. A large proportion of tourism profits currently is offset by the bill for imported food. Why not take advantage of this situation and create local boutique brands and sell them in Croatian hotels directly? Visitors who like these products will look for them in their home country shop shelves, directly leading to exporting the goods to the visitors’ countries.
Geographical regions to look for good ROI and income stream are: Istria, the coastal areas, the islands and the Dubrovnik/ Peljesac region.
Stone villas in the Istrian countryside
As a child I played with my cousins, running down the green rolling hills of the quaint Istrian countryside. We gathered flowers, picked strawberries, shouted in the wind and chased the chickens down the twisty lane. Laying in the grass and looking at the clouds was our favorite past time. We had red cheeks and a lions appetite. Evenings we spent listening to stories next to the open fire. We woke up early morning to the sound of the famous Istrian nightingale and the smell of freshly baked bread.
Somebody once told me a story about people that lived here for centuries and than they were gone… They left behind their belongings, servants and their manors and dispersed around the world.
One day a visionary came up with the idea to purchase these seemingly ruinous remains of the tumultuos past and lovingly restore them to their former glory. The houses have been brought into the 21st century by installing the newest modern amenities the heart can desire.
This combination of simple living and luxury has taken off. It has become a very popular way to spend holidays for many European upmarket visitors. Many have fallen in love with the simple life and beauty of the countryside and have since purchased their own little heaven on earth.
What is so special about the old stone houses scattered all over the Istrian countryside? Why do they make a good real estate investment?
First we must look closely at the locality where these houses are usually found. The most common places being Istria, the largest Croatian peninsula, Croatian coastal areas and the Croatian islands. As the famous real estate adaggio goes location,location, location!
Second will be the price. Houses ranging for example, from 150m2 to 200m2 and land size 2000-5000m2 can be still found for €80 000-120000 euros.
Thirdly they are very popular with holiday makers and they provide a handsome income stream from holiday rental.
Lastly they are unique and limited in numbers. Basically this type of property is like a classic automobile, less of them available for purchase on the market means increasing value.
In conclusion the reasons why you should look into investing in this type of unique property are:
Prices are still low compared to similar type of property around the world (for example Tuscany)
Holiday rental can bring a good income stream
Easy to maintain and the stone they are built from is a natural insulator, saving energy.
Croatia does not have property taxes, which is an additional bonus.
Since their number is limited and they are very popular with tourists and the EU investor community, good value appreciation can be expected.
Example and costs:
This is a typical example of an Istrian stone house for renovation. In this case the house is a part of an abandoned village. Houses in similar condition and on a good location ranging from 250-200m2 living space with land size varying from 2000-5000m2 will be found on the market from €80 000-100 000 depending on the size and condition.
Costs of all architectural drawings, documentation, licensing, deeds transfer and property transfer deeds will bring the final total cost to € 225 000.
Now the house is ready to be rented out. The usual going price of rental is €300-400 per day. The perfect marriage of traditional architecture and 21st century luxury.
The Croatian ascendency to the European Union is bound to have a major impact on the Croatian real estate market.
To this day, the Croatian market has not been adversely affected by the European economic crisis, the reason being, that Croatia is still not officially part of The EU and remains attractive to potential investors.
While investors are very cautious because of the current economic climate in other areas around Europe, there are still positive signs that investors are looking to Croatia.
With Chinese interest in shipyards and ports growing, many European, Eastern and American investors are investigating the opportunities in the newly shaped EU member.
Is the big rush for Croatian real estate just about to begin? Will you be part of it?
Invest in Property Croatia
Welcome to the very first blog by Invest in Property Croatia, the first, we assure you of many. We are extremely excited to get our blog moving with news and articles of Real Estate matters, from the heart of this magnificent country and along the way impart our deep-seated love for all things Croatia too.
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