Dubrovnik to become first in Croatia to ban new apartments

Dubrovnik

The city of Dubrovnik will be the first in Croatia to decide to limit the further spread of apartments, but they will also be the first to reduce the number of beds in private accommodation. 

The goal is to reduce the number of beds currently being rented by 30 percent, Mayor Mato Franković confirmed to daily 24sata.

Dubrovnik has approximately 48,000 beds for 42,000 residents, and when you exclude hotels, there are 16,532 beds in private accommodation. This means that almost 5,000 beds currently rented in apartments will be eliminated.

Dubrovnik is just the first, but certainly won’t be the only one. The new Tourism Law, which comes into effect next year, introduces the obligation for cities and municipalities to create destination management plans. 

Behind this dry term is precisely this: determining how much tourist accommodation a place can bear and limiting and reducing it if they believe apartment rental is becoming excessive. Until now, local authorities haven’t made these decisions.

Franković says that there are acquired rights, and existing apartments will not be abolished overnight but gradually through permit renewals. 

However, he plans to prohibit further apartmentisation.

“Residential zones were never meant to become rental zones. In every new building constructed over time, apartments are converted into tourist rentals because capital triumphs over labor. Renters can afford to buy second or third properties, while young people who want to live and work in the city cannot find affordable long-term rentals or purchase homes. These young people are my priority. Initial estimates suggest that we need to reduce the number of beds in private accommodation by 30 percent, and we will prohibit tourist rentals in residential zones. We have reached the maximum and need to reduce the number of beds in apartments,” explains Franković.

How will they implement this? He says they are already working on a “carrying capacity” study for the old town, which should be adopted within six months. 

Then they will divide the city into four additional zones, for which they will conduct similar studies and establish rental regulations. We asked him about the criteria for discontinuing accommodation for some and not others. He says they will work out the specifics.

“But today, we have cases where someone receives a four-star categorisation, which no one checks afterward. As a city, we were not consulted when garages were legalised and converted into apartments. Now we have been granted legal authority, and garages will certainly not become apartments in Dubrovnik,” says Franković.

Dubrovnik

Incidentally, Dubrovnik was the first to raise the tourist flat-rate paid annually per bed to a maximum of 200 euros in the old town. Starting from the New Year, all rental property owners in Croatia will have to pay a tax on vacation homes, even if they rent out an apartment. The recently adopted law gives local authorities the ability to raise the vacation home tax to five euros per square meter, whereas the maximum for this year was two euros per square meter annually. Franković firmly confirms that they will raise this tax to five euros per square meter. He says it’s a small percentage of what they earn. 

Is he afraid of losing elections after these moves?

“I’m not afraid. Some things are necessary and good for Dubrovnik’s tourism in the long run,” concluded Franković for 24sata.