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Buying a Property in Montenegro

Why Montenegro?

Having suffered great hardship during the Balkan Conflict of the 1990s, Montenegro is now undergoing a period of change and economic growth. It is a candidate for EU accession, and already receives generous EU funding, which is enabling it to overhaul its ailing infrastructure.

These factors, combined with deep blue seas, beautiful beaches, pristine lakes and rivers, rugged mountains, lush green forests, picturesque villages and well-preserved medieval towns, have led to resurgence in tourism, which in turn has created the conditions for an emerging property market.

We hope this guide will help you decide whether to consider Montenegro for your property purchase. Many research tools are available, including television and radio programmes, magazines, the internet, property exhibitions and estate agents.

The property market

Montenegro is widely believed to be in the first stages of a property boom. Prices are around 40 per cent cheaper than in neighbouring Croatia, the average being EUR150,000 (around £110,000) for a two-bedroom apartment and EUR250,000 (approximately £180,000) for a three-bedroom house.

In the short term, money can be made from letting, to tourists or to the domestic market, depending on location. Prospects for long-term growth seem promising, as the local population grows richer, mortgages become more widely available and the international property market becomes established. Rental yields can reach 8-10 per cent.

Opportunities for capital appreciation are currently greatest in the south of the country and in mountain resorts, including the ski areas of the north and east, where the winter sports industry looks poised to expand.

Popular locations – an overview

The Kotor Bay region, at the northern end of Montenegro’s dramatic coast, has traditionally attracted the majority of foreign property investors, including Germans, Italians, Russians and the British.

The area’s popularity is reflected in prices, which tend to be considerably higher than the country’s average; a three-bedroom house costs around EUR400,000 (about £311,000).

The centre part of the coastline, the Budva Riviera, is Montenegro’s tourism capital. A three-bedroom house in the city of Budva costs an average of EUR400,000 (approximately £311,000), and properties close to the region’s long, sandy beaches are expected to see significant price increases.

Kotor Bay

Kotor Bay, a UNESCO World Heritage Site, is actually Europe’s most southerly fjord. The area combines attractive, varied coastline and mountainous inland terrain with culture and history.

The ancient walled port of Kotor, which has one of Europe’s best-preserved medieval Old Towns, is another World Heritage Site. Its summer carnival draws crowds, and it is known for its nightlife.

Like Kotor, the towns of Bar, Herceg Novi, Perast, Prcanj and Tivat (which boasts one of Montenegro’s two international airports) offer a range of properties, including apartments and detached houses, many within a short walk of the sea. Rents have more than doubled over the last two years, with almost 100 per cent occupancy during high season in good-quality developments.

More pages

Page 1: Why Montenegro?
Page 2: The Adriatic Coast
Page 3: Money matters
Page 4: And finally …

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