This article explains how Croatia’s proposed rental law would formalise agreements and change the risk calculations around rented premises.
A proposed framework for a growing rental market
Croatia’s government is preparing a new law on residential leases, with planned entry into force on 1 January 2027. The stated aim is to clarify the relationship between tenants and landlords, limit arbitrary rent increases and speed up eviction when an agreement is breached. The proposal follows a sharp increase in long-term rental contracts: HRT reported that their number rose from 100,000 to 240,000 over the past six years. The measure is therefore aimed at a market where more parties depend on clear, predictable contract terms, although the law has not yet been enacted.
Annual limits would be written into the rental terms
Under the proposal, rent could be increased only once a year, and the rise could not exceed the rate of growth in residential property prices. HRT reported that this rate is currently between 14 and 15 per cent. The government presents the restriction as a way to give tenants greater legal certainty and prevent prices changing without clear rules. For organisations arranging rented premises, the transferable point is that the rental agreement would become the central record of the parties’ rights, payment expectations and adjustment mechanism. The precise effect will depend on the final legislation and contract wording.
Notarisation would connect the contract to enforcement
The proposed law would require rental agreements to be concluded before a public notary, with the cost borne by the landlord. The notary would explain the provisions to both parties, and the agreement would contain an enforceable clause. That mechanism is different from simply signing a private contract: if the agreement is breached, the stated process would begin with a warning and could then move to enforcement based on the notarised agreement, without a prior lengthy civil case. State secretary Željko Uhlir said eviction would follow clearly prescribed deadlines and steps where legal conditions were met.
Formal contracts could alter supply and procurement risk
The proposal also seeks to reduce undeclared long-term rentals by increasing the number of registered agreements and linking the rental system with the Tax Administration. Uhlir said the number of rental contracts increased by 75,000 between 2024 and 2025, and that the introduction of a property tax had encouraged some owners to legalise rentals. For businesses and public bodies procuring rented offices, housing or other premises, the lesson is that a lease is not the same as a standard goods or services procurement procedure: its price, duration, enforcement route and tax treatment must be assessed as contractual conditions. Experts cited by HRT also warn that owners may raise prices or withdraw properties if recovery of possession remains uncertain.
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The bill is expected to enter regular parliamentary procedure before its planned start on 1 January 2027. Until it is adopted, the proposed rent cap, mandatory notarisation and enforcement route remain policy plans rather than binding requirements.
Reported from index.hr, 2026-09-12. The Tender Wire is published by Otnox.
