Property for sale in Montenegro
Beautiful coastline, mountains, lakes and mines perfectly describe Montenegro. It has incredible towns, marvelous islands, and beautiful canyons. The lovers of both the mountains and the sea come here to relax. So, let’s find out all the nuances of real estate investment in Montenegro.
Real estate market of a country
The residential real estate market in a country is witnessing a rise in interest from global investors, driven by its beautiful coastal scenery and competitive prices.
By 2024, the market is expected to reach a value of US$17.15 billion, with an estimated annual growth rate of 5.69% projected between 2024 and 2028.
This growth trajectory is anticipated to result in a market volume of US $21.40 billion by 2028.
Reasons to invest in Montenegro
There are some reasons why it is a good place to invest in:
- The political environment is steady, with a government focused on joining the EU.
- Montenegro is at the forefront for EU membership and joined NATO (2017).
- Tax rates, including income and profit tax, are low at 9% compared to other European nations. The country uses the Euro as its currency, providing stability despite not being part of the EU.
- Tourism is the key economic sector in a country, attracting around 2.5 million tourists in 2019.
- Its strategic location in Southern Europe along the Adriatic Sea has historically made it a crossroads between East and West.
Can foreigner buy property in Montenegro?
Non-citizens are permitted to buy real estate in Montenegro by presenting their international passport and providing a deposit for the chosen property. Traditionally, the initial payment is 10% of the total transaction amount, although this may be adjusted for larger sums through further negotiation.
Where is the best place to buy property in Montenegro?
Financing chances can vary, but coastal areas like Budva and Tivat are popular for buying real estate in Montenegro. They have access to the Adriatic coast and varieties of housing.
Can I buy property in installments and are there any variants for purchasing property for a mortgage?
In Montenegro, property owners often offer their properties for sale with the option of paying in installments, as outlined in a contract with specific payment terms. An entry in the cadastre prevents any resale, donation, or re-registration of the housing as long as the installment agreement is in effect, providing protection for the buyer.
Mortgages are not widely used in this country, with only a limited number of mortgage options available for high-end developments where apartment prices start at 200000 euros.
Is it possible to acquire a jointly owned property? How many people can become co-owners?
It is indeed possible for multiple individuals to purchase and co-own property together. There isn’t a set limit to the number of those who can be involved in the acquisition and shared ownership of the housing. However, it is vital to note that only the property owner and their immediate family members are eligible to apply for a residence permit based on the ownership of the real estate.
How to bequeath a real estate object in Montenegro to a foreign citizen?
Inheritance according to a will specifies that the beneficiaries mentioned in the document will receive the inheritance, and their citizenship does not affect this process.
Conversely, intestate succession prioritizes the spouse as the primary claimant to the property, followed by the children and parents. All other relatives come next, regardless of the citizenship of the owner and the heir.
Legalization of unauthorized construction objects (built without a construction permit). What is legalization and why is it needed?
The law regarding the legalization of real estate properties was introduced in 2016. The legalization process is based on an application form. The property owner or their representative has to provide a set of papers, including an application for registering an object without a construction permit. Following this, the local administration adds land tax to the payment. Once the land tax is paid, the entry stating that the object was built without allowance is removed. This tax can be paid in installments over a period of up to 10 years.
If the object does not have a construction permit, can it be sold/bought or demolished?
A property in Montenegro for sale without a construction allowance, but is in the cadastre, can be acquired and sold without restrictions, just like a property with an allowance. Objects that may be decimated include those that:
- are located in areas where the urban development plan allows for other construction projects;
- do not match a building constructed without permission;
- are situated on the first coastline (if the Ministry of Morsko Dobro or a detailed urban plan allows for the manufacturing of a hotel or other objects there, and the unauthorized building does not comply with the urban development plan).
If a building was constructed in an area with no comprehensive plan and is submitted for legalization, it becomes legal. All actions related to acquiring,selling, donating, inheriting, and obtaining a residence permit are legal and unrestricted.
Can I register the title in the name of a child?
Yes, registering the property in your kid’s name is possible. However, if you choose to sell the property before your kid reaches legal age, you will have to manage interactions with guardianship authorities.
What is the language used in the contract of sale of real estate? How can I exclude the possibility of misunderstanding the terms of the contract?
The contract is in Montenegrin. There is a lawyer who knows two languages present during the signing, and a court interpreter reads the contract in your native language before it is signed. If you require a contract’s translation into your native language, it can be provided for an extra fee.
When does the ownership transfer to the purchaser according to the law of a country?
It appears when the purchaser makes the full payment of real estate in Montenegro.
What is the potential income from renting out housing in Montenegro?
The typical yearly rental income from real estate Montenegro typically ranges within 6% and 10% of the property’s value, based on the kind of property.
Is it possible to conclude an acquiring and sale transaction by proxy?
Certainly. Facilitating transactions using distant proxy registration is possible. The seller and buyer engage in a video call, with the participation of a lawyer and a court interpreter. The far away contract conclusion process is identical to an in-person one, allowing the client to monitor the signing process using a video link.
Is there a real estate tax in a country? How much does it cost to maintain housing?
There exists a tax on real estate for sale in Montenegro, which amounts to 3% of the assessed value of the property acquired, although more commonly it is based on the contracted amount. This non-recurring tax must be settled within 14 days following the purchase. Additionally, Montenegro imposes an annual property tax and tourist tax, paid once a year. The payment amount is influenced by various aspects including the location, distance to the beach and city, availability of urban utilities, size, and land area (for houses or villas).
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