Zagreb is the capital city of Croatia and the largest city in the country, with a population of over 806,000 as of 2019. The city is located on the banks of the Sava River, in the northwestern part of Croatia. Notable for its architecture, including an array of church spires and collection of parks, Zagreb is gradually becoming a more prominent fixture of the tourist calendar.

Being a two-hour drive from the coast, Zagreb has often been treated by tourists as a stop-off point on the way to the beach. However, the capital city has a unique culture which is distinctive from the rest of Croatia. Home to the University of Zagreb, Academy of Sciences and Art and the Croatian National Theatre, Zagreb is the cultural heart of the nation.

Zagreb has seen appreciable increases in house prices year-on-year. Figures are promising for those looking for ROI opportunities. New dwelling prices rose by 14.8% y-o-y in Q2 2022, whilst on a quarterly basis, prices increased 3.85%. When adjusted for inflation, these figures are more modest, at 2.45% and -1.38% respectively. Gross rental yields can reach around 5.4% to 6.0%.

  • Zagreb is the capital city of Croatia, two hours from the Adriatic Coast.
  • New dwelling prices rose by nearly 15% Year-On-Year in the second quarter of 2022.
  • Gross rental yields are mostly higher than other Croatian cities.

House Prices in Zagreb

House prices in the capital are resilient. According to the Croatian Bureau of Statistics, despite experiencing a slump from 2008 through to 2016, house prices overall in Croatia have surged both in nominal and real terms through to 2022. However, there is still a large disparity between nominal and real figures, owing to the sharp rise in inflation during 2022.

However, on a quarterly basis, it should be noted that house prices are volatile. Both nominal and real yields fluctuate from quarter-to-quarter, which could impact the returns of foreign investors into the country. During 2021, the quarterly change in house prices – inflation adjusted – led to figures of -0.91%, 2.58%, 0.45% and 0.63% for Q1, Q2, Q3 and Q4 respectively.

In comparison to the rest of Europe, Croatia's house prices have performed strongly. In the previous 5 years, Croatia's house prices grew by 52.59% – not adjusted for inflation. In the previous year alone, Croatia's house prices rose by nearly 14%. Although those figures consider the country more broadly, the trends are a good indication of the Croatian housing market.

Buy-to-Let Yields in Zagreb

For investors exploring the buy-to-let market, Zagreb presents above-average gross rental yields. The price-to-rent ratio in the city centre is 30.66 and outside the city centre is 28.81, indicative of a housing market which favours rentals. The price of rent varies from 4,171.90kn ($577) for a one-bed apartment in the city centre to just under 7kn ($969) for a three-bedroom apartment.

However, local administrative procedures should be researched by prospective foreign property investors. Although laws between landlords and tenants are neutral, evicting overstaying tenants can be difficult. Croatia's law courts are experiencing a backlog and so external agencies are often relied upon to remove unwanted tenants.

Throughout the various districts in Zagreb, rental prices do not vary too much in relation to apartments. For studio accommodation, prices mostly sit around the EUR 300 – 400 mark per calendar month. On the other end of the spectrum, four-bedroom properties can range from EUR 1,000 to nearly EUR 2,000 pcm in places like Gornji Grad and Donji Grad.


The strong demand for rental accommodation, combined with the limited availability, means it is highly likely gross rental yields will continue to perform well for landlords. However, as previously mentioned, nominal figures are being undermined by inflationary pressures. Inflation will likely have to reduce before investors can capitalise on the buoyant Croatian housing market.