Croatia proposes new real estate law to strengthen buyer protection and market transparency

The Croatian government has approved a proposal for a new law regulating real estate brokerage, introducing stricter rules aimed at improving buyer protection, raising professional standards and increasing transparency in the property market.

The draft legislation, which will now move to the Croatian Parliament for debate, represents the most significant update to the sector since the current law was introduced in 2007.

Speaking about the changes on HRT’s Studio 4, Branka Augustinović, Director of the Directorate for Trade and Internal Market at the Ministry of Economy, said the existing law had only undergone minor amendments over the past two decades, despite major changes in the real estate market.

In recent years, Croatia’s property market has grown rapidly, with new business models, agencies and intermediaries entering the sector. The initiative for a comprehensive overhaul of the law came largely from the Croatian Chamber of Economy and its real estate association.

According to Augustinović, the new legislation aims to increase professionalism among real estate brokers and agents while strengthening protection for buyers and property owners.

One of the key measures will prohibit agencies from requiring potential buyers to sign property viewing agreements before they are allowed to see a property.

During the public consultation process, many buyers reported being asked to sign such agreements, which could automatically oblige them to pay certain fees. The new law explicitly bans this practice, ensuring buyers can view properties freely before entering into any contractual obligations.

The proposed law also introduces stricter professional requirements for agencies. Every brokerage company will be required to employ at least one qualified agent on a full-time basis, and each agent will be permitted to work for only one agency.

Ilana Mihaljinec-Knežević, a board member of the Croatian Chamber of Economy’s Real Estate Association, said the industry had maintained an open dialogue with the ministry throughout the drafting process.

She noted that the changes will more clearly distinguish between legal and illegal brokerage activities and introduce tougher penalties for violations. Agencies will also be required to sign mediation contracts before advertising properties, while commissions can only be charged to both parties if both have signed formal agreements.

The reforms will also bring higher minimum insurance requirements and differentiated fines for breaches of the law.

If adopted, the legislation is expected to enter full application during the summer after completing parliamentary readings.

Industry representatives believe the changes will strengthen trust in the sector and ensure better protection for consumers in what is often one of the most significant financial transactions of their lives.