Croatia introduces new property agency law from 7 July with stronger buyer protections

Croatia’s updated Law on Real Estate Brokerage comes into force on 7 July, introducing stricter rules for estate agencies and brokers in a move designed to improve transparency, strengthen consumer protection and tackle illegal activity in the property market.

The legislation replaces rules that have been in place since 2007 and introduces a number of new requirements affecting buyers, sellers, landlords, tenants and estate agents.

According to representatives of the Croatian Chamber of Economy (HGK) speaking on the main evening news Dnevnik on HRT, the new law provides clearer regulation of relationships between all parties involved in property transactions while increasing oversight of brokerage activities.

Among the key changes are significantly higher penalties for illegal brokerage, increased professional liability insurance requirements and clearer contractual obligations between agencies and clients. A mandatory code of ethics has also been introduced for the sector.

Consumers are being urged to check that an estate agency is listed in the official public register before using its services. Under the new rules, individuals who have passed the professional examination can no longer operate independently unless they are employed by an authorised brokerage company.

The law also introduces stricter standards for those running brokerage businesses, including measures aimed at preventing individuals with criminal records from managing agencies.

Another important change concerns property advertising. Estate agencies will no longer be permitted to advertise properties unless they have signed a formal brokerage agreement with the owner.

The legislation also distinguishes between simply viewing a property and entering into a brokerage relationship. Agencies may only charge commission after a brokerage agreement has been signed, preventing commission fees from being required simply to arrange a viewing.

While the legal framework is being strengthened, industry representatives say wider market challenges remain. Property prices are expected to continue rising, although growth is likely to vary between different regions and property types.

At the same time, the number of property transactions has been falling as affordability pressures limit the pool of potential buyers. Industry experts also point to limited housing supply, particularly along the Adriatic coast, where tourism continues to influence demand and reduce the availability of homes for local residents. Unrealistic pricing expectations among some sellers have also contributed to slower sales, particularly in the second-hand property market.