What’s Happening to Property in Montenegro?

Montenegro finally became independent from Serbia in June 2006 and ever since then property prices in certain parts of the country have started to go up so rapidly that it’s not a question of whether local residents will be priced out of the market it is simply a fact that they already have been.  So what’s happening to property in Montenegro?

Well, on the one hand the inimitable desirability of the nation is causing incredibly wealthy buyers to target luxurious palaces, castles and stately homes in Montenegro - of which there is an abundance in need of some TLC - and all of which make sumptuous holiday homes or investment properties…

And on the other hand Crown Prince Nicholas of Montenegro is actively targeting wealthy investors and high profile purchasers such as Michael Douglas, Catherine Zeta-Jones and Roman Abramovich to the country in a bid to change the entire aspect of Montenegro from a former war torn nation with severe unemployment problems to a country on an economic and fashionable par with Monaco.

But is the current state of the Montenegro property market and the rate at which real estate prices are increasing in the nation sustainable?

Certain facts about Montenegro and its property market are undeniable – firstly the country is beautiful, it is rich in culture, history and natural delights, it has a wealth of affordable property and it also has a lot of incredible properties such as baroque palaces and castles just lying empty and calling out for someone rich to buy them and care for them. 

Many of these properties can be turned into tourism opportunities from attractions to accommodation for the growing numbers of tourists Montenegro is now managing to attract annually.

A growing number of these unique and high end property based opportunities are being targeted by wealthy Russian purchasers – in fact it’s a Russian consortium that has just opened the very first truly five star hotel in Montenegro.

The Russian’s are especially attracted to a market where they see a wealth of tourism related opportunity – although some wary local citizens believe the Russians are using Montenegro and its property market for money laundering – and where they can really exploit their spending power and buy up unique parcels of land and real estate such as a 100,000 square meter building on the untouched Lustica peninsula which was recently bought by a Russian investor.

So, the Russians are fuelling property prices…and their investment is underpinned by the desireability of Montenegro for tourism (unless you’re cynical and then you might think their investment is underpinned by a lack of questions being asked about the origins of their investment funds)…and Crown Prince Nicholas is seeking to attract wealthy buyers from around the world to raise the profile and standing of his country even more. 

According to major press reports recently the prince is keen to welcome famous buyers from the world of entertainment and sport to improve the social standing of Montenegro and turn it into a playground for the rich and famous.

Whether the Crown Prince’s plans and the Russians’ bid for economic dominnace in Montenegro will be fulfilled is something we will have to wait and see…meanwhile property prices in the most sought-after towns across the country have gone up to between 1,200 euros in the likes of Tivat to in excess of 2,000 euros elsewhere – and this at a time when unemployment is almost touching 30% and the average monthly income is just 200 euros…

So in answer to the earlier posed question - ‘is the current state of the Montenegro property market and the rate at which real estate prices are increasing in the nation sustainable?’ – one might be inclined to say ‘no’…but we will wait and see!

Special Reports: Property News for Montenegro

Montenegro Property Buyer’s Guide
The real estate sector in Montenegro is emerging as one of the more exciting markets for property investors in Europe

Montenegro Investment Property Buying Process
Buying investment property in Montenegro is buying in a truly emerging market and investors should be aware of the risks

Montenegro Property Investment Guide
Montenegro has substantial long term potential for a property investor seeking a rich emerging real estate market