Montenegrin Real Estate Market
The Opportunity & Property Rights
The real estate market in Montenegro is new and emerging rapidly.
The emerging of the real estate market is the outcome of
privatisation, restitution and a rapid growth in the tourism
industry.
Montenegro has emerged as one of the latest and yet unspoilt
destinations in the Mediterranean attracting both tourists and
property investors. The World Tourism Organisation (WTO) confirmed
that Montenegro had the fastest tourism growth worldwide in 2006
and again in 2007, and this trend is expected to continue over the
next 5 years. Similar to Croatia in terms of coastal geography and
a relaxed way of life, Montenegro has benefited from Croatia's huge
and rapid success as a place to visit and acquire a property.
The wealth of potential in the market stems from the fact that
real estate in Montenegro is materially undervalued and growing in
demand from those seeking a luxury holiday home in the sun.
Immediate gains can be realised from the rental of suitable coastal
properties to the fledgling but burgeoning tourism market, with
longer term rental income likely from well appointed and located
apartments in the main towns in this tiny gem of a European
country. In the medium to longer term the property market in
Montenegro is likely to reward a patient investor with substantial
capital growth accompanied with a boost by inward foreign direct
investment.
Unique selling points in Montenegro real estate market is the
picturesque Montenegrin coast accompanied with pleasant year-round
climate and unspoilt natural beauty. The Bay of Boka, which is
considered to be the most attractive part of the Montenegrin coast
and voted as one of the top 10 most beautiful bays in the world,
hosts celebrities and the super high net worth individuals amongst
the new property owners. This has generated a healthy amount of
interest in the region and has put Montenegro on the list of
'hotspots' for residential real estate, particularly at the luxury
end of the market.
Both foreign and domestic investors are allowed to freely
establish, acquire and dispose of business interests. The
Montenegrin Foreign Investment Law states that foreign persons and
companies can, based on reciprocity, acquire rights to real estate,
including: company facilities, place of business, living spaces and
land for construction. In addition, foreigners claim property
rights to real estate by inheritance in the same manner as a
domestic citizen.
Legal safeguards are in place to protect against expropriation,
outlined in the Foreign Investment Law. The law states that the
government cannot expropriate property of a foreign investor unless
there is a compelling purpose established by law or on the basis of
the law. If expropriation occurs, compensation must be provided at
fair market value plus one basis points above LIBOR rate for the
period between the expropriation and date of payment of
compensation. Importantly, to date, there have been no cases of
expropriation of foreign investments in Montenegro.
Current Projects
By way of illustration and a comparative, current projects and
their indicative pricings are as follows:
- The Mirax "Astra" Development is a Russian capital investment
and due for completion ahead of schedule. This complex of deluxe
smart villas is 50% sold off plan with remaining space on the
market for €6,000m2 for second line and €8,000m2 for front line sea
facing, including terrace space
- The TQ development includes brand name retail, a supermarket,
bank and office space with deluxe smart home apartments from
60m2-100m2 in size. Completion is anticipated for early July 2009,
with residential space retailing at €6,000m2-€7,000m2, including
terrace areas.
- Other current in progress and anticipated projects
include:
- €500 million Super-yacht marina in Tivat
- €30 million refurbishment of Tivat, Podgorica and Dubrovnik
International airports.
LATEST NEWS
- Montenegro’s New Golden Era - Country Life28 July, 2009
- Montenegro Could Be The New Riviera - The Daily Mail6 July, 2009
- Russians Turn “Queen” into a Casino - visitmontenegro.com3 July, 2009