How can I become the owner of a Candy Brick villa?
To have a profitable return on investment, become an owner of one of the Candy Brick villas. The final cost of a Candy Brick villa is €360,000 – €550,000 depending on the project.
Once you have decided on your villa, you can reserve it by signing the purchase agreement and paying an initial 20% reservation deposit. At the accomplishment of construction phases, you pay further tranches. When the villa is completed, ownership is transferred over to you on the payment of the balance.
You can purchase a Candy Brick villa either as a private person or as a company. We recommend you opening a d.o.o. (private limited) company in Croatia for the following reasons:
- It is very fast, only taking a few days to establish, and is relatively cheap, costing around €1,000 to incorporate and €1,000 in annual management costs;
- Companies with an income lower than 3 million Croatian kuna (HRK) only pay 12% corporate tax. After deducting your costs (including depreciation) it amounts to about 2% of your rental income (€720);
- The VAT is fully recoverble off the purchase price and it is an additional 25% in Croatia. It is reimbursed by the government within around 30 days.
- You can avoid tax on dividend if you loan your company the amount to buy the villa via an interest free loan, and pay yourself back steady interest free loan repayments.
If you decide to go for this option we will help you and introduce you to one of our partners for accounting services.
- Price of your villa: €360,000
- Rental income: €30,000
- Full rental and management service: €6,000
- Annual depreciation cost: €18,000
- Profit before tax: €6,000
- Tax expense: €720
- Profit after tax: €5,280
- Cash in bank account: €23,280
- Return on investment: 8.33% before costs and taxes, 6.47% after. 53% higher than the Croatian average.
Please note, these calculations have been made excluding other marginal and communal costs, such as your water and rubbish collection, that you can use to reduce your profit before tax.
We have also not included the additional income you could make from selling the excess electricity your solar panels make to the grid.
This could be between €3-4 a day when the villa is not in use. In the future this income could increase up to 10x should the government reintroduce feed-in tariffs. Nor have we included the benefit of spending 2 weeks for free in your villa, worth €2,500 (excluding July and August).
For financing, if you need it, the best thing to do is contact your bank. Your bank knows your specific situation and will be offering the best solution according to your needs.
Getting a mortgage for your villa in Croatia is also possible from a Croatian bank, and can be given up to 80%. Again, this would need to be discussed depending on your specific situation. We would be more than happy to introduce you to our partner banks.