Adriatic elegance

For both travel and investment, Croatia has been the buzz destination of 2004. But north of the overheated Dalmatian coast is a region of both beauty and bargains, says Ginetta Vedrickas
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Croatia has been growing in popularity with British buyers for some years, the majority of whom search for properties in either Dubrovnik or the small islands stretching the length of the Dalmatian coast.

Croatia has been growing in popularity with British buyers for some years, the majority of whom search for properties in either Dubrovnik or the small islands stretching the length of the Dalmatian coast.

While prices in the southern parts of the country have increased steeply, buyers can still bag themselves a bargain by heading for Istria, a triangular peninsula in the north-west of the country.

This is true borderland, where Italy, Slovenia and Croatia meet, but no one can claim that Istria is uncharted territory. Package tourism came early to the region and the purpose-built holiday resorts that line the west coast, particularly Porec, have less to do with Mediterranean charm than they do with concrete. Head inland, however, and it's a different story. Traditional farmhouses, rolling countryside and Italianate architecture explain why this part of Croatia is now being described in the same terms as Tuscany used to be.

The agent Croatiansun has been selling in and around the Dubrovnik area for some years, but last month saw their first Istrian office open in the medieval port of Rovinj. Next to the gates of the old city, the new office will cover Istria's western coast and inner region, including the islands of Krk and Cres, and later this month a second branch in Pula is planned, which will cover eastern Istria.

MD Paul Keppler says that the new branches are vital to cope with growing demand from UK and Irish investors. "Interest in Croatia for both residential and holiday tourism is rising dramatically," he says. "Istria has become a prime location fuelled largely by ease of access to the area, with flights from the UK to Trieste in Italy, only 45 minutes away, and the low cost flights to Ljubljana, in Slovenia."

The agency's current range of property in Istria includes a four-bedroom traditional villa in Jehnici. Set on a 1,000sqm plot with views across rolling green hills, the price of £260,000 includes a pool and fully fitted bathrooms and kitchen. In Lovrec, a three-bedroom property with open fireplace and original wooden beamed ceilings is for sale at around £215,000, again with pool included.

A five-bedroom villa in Vizinada, on a hillside with spectacular views of the medieval town Motovun and overlooking the new golf course, near where Michael Schumacher recently bought, is for sale at £425,000. "Prices in this region are around 50 per cent less than equivalent properties in the south," adds Keppler.

Another agency, Avatar International, is selling a six-bedroom house with large courtyard and galleried living room in a quiet village near Rovinj, only 10 minutes' drive to the sea, for £234,800. Avatar's Amar Sodhi believes that properties such as this one will attract second-home owners and investors who hope that Istria's accessibility will ensure a good rental income compared to destinations further south.

"Croatian airlines are expensive so this adds to the cost of your holiday further south. Four tickets to Dubrovnik can easily cost £1,000, which, added to your rental of £500 per week, increases holiday costs substantially. Whereas four flights to Trieste on Ryanair can be as little as £100, and this is attractive to anyone thinking about rental potential."

This new ease of access mean that weekend visits are possible, but Sodhi warns that the climate in this part of the country cannot compete with that in the south. "Last winter, I was in Split when it was 18C, and you could feel the warmth of the sun on your back. Istria is near the Italian border and the mountains, so it's never going to compete in weather terms, which may deter some British buyers."

It may not have the longer season of the south, but its cobbled streets, Italian architecture and verdant countryside are big draws for the growing numbers of British buyers who are heading here. On a recent visit Andrea Mackwood was instantly smitten. She has bought a plot near Motovun for a three-bedroom property with pool. "We fell in love with the region; it's absolutely beautiful. The countryside is just like Tuscany and with gorgeous sea views."

Mackwood's house will be constructed in typical Istrian stone, giving it the appearance of period property but with a high build quality. It is costing around £200,000, which she admits wouldn't buy her much in Tuscany and certainly not within 25 minutes' drive of the coast. Mackwood believes that cheap flights will make it easy to let: "It's the combination of investment potential, being able to buy a holiday home for ourselves and to rent out, and the idea that prices will go up."

Naomi Greatbanks from FPDSavills sees Croatia appealing to both investors and buyers. "Everyone who goes there thinks it's incredibly beautiful and you can still get such good value for money and buy something special. A three- or four-bedroom stone house with pool and 10 acres can cost as little as £240,000."

FPD Savills has only recently started selling in Croatia but Greatbanks has already noticed that it is attracting buyers who have turned their backs on Spain. "It has really shot itself in the foot because of over development and high prices."

She doesn't believe that Croatia will suffer a similar fate, however: "The government sent a delegation to Marbella and they definitely don't want that happening in their country so they've introduced strict building controls, which is a good thing.", 00 385 20 312 228, 08707 282827 FPDSavills, 020-7824 9030