Frequently Asked Questions
Question about buying
No, there are currently no restrictions on foreigners wishing to buy a property in Montenegro, all you need is a valid passport, and our devoted team of real estate experts and professionals will do the rest!
Quite often, property owners offer their objects on a condition of payment by installments. Interest-free installments, all payment terms are set forth in the contract. An entry in the cadastre prohibits any possibility of resale, donation, or any other re-registration of this object as long as the installment agreement is valid. This contributes to the protection of the buyer.
Mortgages are not common in Montenegro. There are only a few mortgage options for luxury complexes under construction, where the cost of apartments starts from 200,000 euros.
The transfer of ownership occurs after the buyer makes a 100% payment.
Yes, it is possible. The number of people involved in the purchase and further co-ownership is not limited. However, only the owner and his close relatives can get a residence permit in Montenegro on the basis of real estate ownership.
Once you’ve decided on the property you’d like to purchase, your personal sales manager and our in-house lawyer will negotiate all the terms and sort out the required documentation at the notary. The purchase and sales contract is signed in front of a notary who is assigned for the region where the property is located and the following documents are signed and registered:
Purchase and sales contract, which can be signed either personally, or by power of attorney (POA);
Clausula Intabulandi: Permitted Property
Registration Clause
Purchase and sales payment schedule – The amount can be paid straight away or can be paid in stages through a certain period of time, depending on the agreement between the parties.
The advice on how to register your property in Montenegro
When you buy a property in Montenegro, it will consist of a deposit, the agreed sales price, as well as the taxes and legal fees.
There is a property purchase tax at the rate of 3% ( if it’s a re-sale property) as well as the fees for drafting the agreement at the notary ‘s, which depending on the length of the contract will vary from €300 to €500 euros.
This rate depends also on the price. For instance, if the price is €100.000 euro, the fee could be approximately €350 euro +21% VAT.
According to the Montenegrin law, a court interpreter specialized in your native language shall be present during signing of the agreement.
The temporary residence permit can be obtained through either purchasing a property in Montenegro or forming & starting a company here – both of which our consultants can help you with, guiding you through the process.
You can also gain Montenegrin citizenship and a passport which will enable you travel to 124 countries visa-free. You can apply for the Montenegro Citizenship by Investment Program, and further information can be found here.
The process of registering your property in Montenegro is rather simple. Our legal team know inside out all aspects of Montenegrin property registry regulations. For an affordable fee and through the given power of attorney, they will register your property for you and assist you in receiving your title deed.
Average annual income from renting out real estate is 6-10% of the cost of housing (depending on the type of property).
The property purchase tax is 3% if you buy a property from an owner.
On the other side, if you purchase your property from the investor/developer, the tax is 0%.
Montenegro has introduced rather favourable and investment-oriented tax policy.
The corporate and personal income tax rates are both 9%.
The capital gain tax rate is also 9%.
Inheritance and pension tax rate is 0%.
Value Added Tax (VAT) rate is 21%.
For all our clients who have bought a property in Montenegro, we have prepared many useful services provided by our departments. We can offer Property Maintenance services, Property Rental Services, and Property Developing Services.
Testate succession. The persons mentioned in the will receive the inheritance regardless of their citizenship.
Intestate succession. As a matter of priority, the spouse claims the property, then the children and parents, and only then all other relatives. The citizenship of the owner and heir does not matter.
The law on the legalization of real estate objects was issued in 2016.
Legalization in Montenegro is based on the application form. The owner or his representative must submit a certain list of documents, including an application for registration of an object that does not have a construction permit. Then the local administration must add on the tax (land tax) to the payment. When the payment for this tax is provided, the entry saying that the object was built without permission is removed.
Land tax can be paid in installments in the course of 10 years (maximum).
Question about renting
To secure housing for an extended period ranging from one month to a year, it is advisable to conduct your search between September and February. During this time, a plethora of options become available on the market at competitive prices, and property owners are more receptive to accommodating renters. If rental housing does not meet your needs, you will have ample time to explore other alternatives.
However, the situation in Podgorica is contrary to this trend. Therefore, it is advisable to search for real estate and rentals during the summer months in Podgorica.
To secure housing for an extended period ranging from one month to a year, it is advisable to conduct your search between September and February. During this time, a plethora of options become available on the market at competitive prices, and property owners are more receptive to accommodating renters. If rental housing does not meet your needs, you will have ample time to explore other alternatives.
However, the situation in Podgorica is contrary to this trend. Therefore, it is advisable to search for real estate and rentals during the summer months in Podgorica.
The contract is concluded by the tenant and the landlord directly or by authorized representatives.
When finalizing a lease agreement, it’s important to consider the following points:
- Ensure that the lessor has settled all utility debts as of the agreement date. Request for utility bills and, if feasible, take photos of the meters on the first day of the agreement to prevent future misunderstandings.
- Verify that all agreed-upon terms are documented in the contract.
- Conduct an inventory of the items available in the rented space, including any defects if there are any, if possible.
On average, the rental cost for a decent modern one-bedroom apartment in Montenegro ranges from 300 to 350 euros, while a two-bedroom apartment can cost between 400 and 500 euros. These are typical rates, with more expensive and cheaper options also available. It’s worth noting that between 2020 and 2022, these rental prices have doubled. Sometimes, these amounts can get you a small house with a garden, depending on the location, condition, and distance from the sea. Budget-friendly rental offers are available in Ulcinj, Bar, and Herceg Novi, while prices are higher in Budva, Tivat, and Kotor. In Podgorica, rental rates are generally similar to those in Budva.
Typically, the rental price includes the agency commission, which is paid by the property owner to the agent.
The payment terms for rental housing can vary depending on the negotiation between the tenant and the property owner, as well as the rental period. Rent can be paid on a monthly, semi-annual, or annual basis, with varying monthly rates. Typically, the last month’s rent is charged in advance as a guarantee for the landlord upon signing the contract. Additionally, a refundable deposit may be charged to cover any potential damage to the property, with the deposit usually being equivalent to one month’s rent.
If a landlord officially rents out their property by signing a notarial agreement, they are required to pay an income tax to the state amounting to 15% of the rental amount indicated in the agreement. However, in many cases, landlords may shift the responsibility of paying this tax onto the tenant. It is an unwritten rule that the party who requires a formal contract is usually responsible for paying the tax. Therefore, it is advisable to clarify with the landlord beforehand whether they will take care of the tax payment or if the tenant will have to do it.