The Minister of Physical Planning, Construction and State Assets, Branko Bacic, presented the national plan for Croatia's housing policy until 2030 on Friday, which aims to provide affordable and sustainable housing. According to estimates, 1.2 billion euros will be needed for this.

The plan is the first medium-term strategic planning act for housing and an important national policy. Bacic said that affordable housing, which he described as one of the most important issues in Croatia, had also been recognised as a problem at EU level.

“This strategic document was developed with a multidisciplinary approach, taking into account demographic, social, economic, financial, spatial and environmental aspects. In a comprehensive analysis, the reasons and solutions for the extremely high housing prices for both buying and renting in Croatia were identified.”

Shortage of over 230,000 homes

Bacic presented data showing that 40 per cent of Croatia’s housing stock – 958,000 units – is not used for residential purposes, while at the same time there is a shortage of over 230,000 homes. Recent years have been characterised by a sharp rise in property and rental prices, as demand has outstripped supply.

The three main objectives of the National Plan – affordable housing, sustainable housing and space for housing – are to be achieved through a combination of financial, fiscal, land and eco-energy policies.

To achieve these goals, several laws will be amended or newly introduced, e.g. on spatial planning, energy efficiency in construction and subsidised housing programmes (POS).

The government plans to activate vacant properties through tax measures, renovate state-owned properties and promote long-term rentals by regulating short-term rentals and creating an affordable rent programme.

In addition, legal certainty in rental contracts is to be strengthened, which is why the Rental Housing Act is to be amended and new state-owned flats are to be built, for which a new POS Act is to be passed.

Programme for affordable rents could trigger the most debate

Bacic said that the Affordable Rent Programme is likely to trigger the most debate, especially in relation to private housing. The programme is aimed at households with incomes below the average but above the poverty line, with priority given to young people.

The programme will be implemented by the Agency for Legal Transactions and Real Estate Brokerage, which will become the central body for the implementation of the national housing programme through amendments to the POS Act.

The capacity for student housing will also be increased to free up housing in larger cities and non-profit housing co-operatives will be encouraged, requiring amendments to the Co-operatives Act.

At least 1,200 state-owned flats will be capitalised

1.2 billion will be needed to implement the National Plan and a revolving fund will be set up to finance the entire plan, the minister said.

The fund will receive money from the state budget, EU funds, bank loans and contributions from citizens who utilise affordable housing measures.

POS programmes are expected to build 8,000 housing units by 2030. In subsidised areas, 2,000 units are to be built or renovated. At least 1,200 state-owned homes will be capitalised, along with additional properties from the public sector.

A further 1,200 units will be built through an active land policy and the promotion of non-profit housing co-operatives. The Affordable Rent Programme will activate 9,000 privately owned homes.