Buying a property in a foreign country means having the same knowledge of the process as a local buyer. At RE/MAX Montenegro, we try to offer our clients, local and foreign, a professional service, and to make the process transparent and simple. Being part of an international real estate network such as RE/MAX gives as infrastructure and knowledge to offer such services to our clients. Through the most sophisticated real estate training, we are able to empower our agents to offer the best service to our clients and make sure the process of buying the property is carried in the most efficient and simple way.
At RE/MAX Montenegro we work with both sales and rents, buyers and sellers, which gives as valuable information and updated knowledge of the market. Our agents are able to guide you through the real estate market in Montenegro, with up-to-date information. Whether you are a lifestyle buyer or an investor, our agents will help you to make a wise decision.
The real estate market in Montenegro has changed over the past 10 years, and many aspects have regularized and became more transparent. The buying procedures are made more simple and safer with introduction of notary offices who are indispensable party within the buying process (check here for the costs of buying the property). However, Montenegro is still a developing country with immature rule of law, and thus cautiousness is ever needed.
Montenegro has not regularized real estate agencies (there is no a real estate license), and thus allowing anyone to work in the industry without prior knowledge of the legal and technical aspects of buying procedure. This means, that relaying on professional agency is recommended.
General Procedures and Costs
After negotiating the price (in our experience, the price reduction is 5% after negotiation, however, consult your agent to understand whether the price is inflated, or it is a fair price), you should leave a reservation deposit. The reservation price will much depend of your impression with the owner. You might agree between 5% and 10%, or just a lamp sum in the case of smaller properties. The deposit could be placed with the notary, the lawyer, the owner, or the most common in our case, with our agency.
In the meantime, you should open a bank account which will make the transactions much easier. Opening a bank account is a simple procedure, and you can always relay on some of the international banks present in the country.
The cadaster books are up-to-date, and you can consult them online (available only in Montenegrin language), and initial due diligence can be easily made by your professional real estate agent. The notary is there to make sure the contract is done according to regulations. However, we always suggest to our foreign clients to hire an English-speaking lawyer to participate in the transaction. Having a lawyer will mean avoiding any wrong steps, and you will feel safer.
The contract has to be signed before the notary. Ask your agent or lawyer to make an appointment with a notary. The contract, outlined by the lawyer and previously agreed with the seller, needs to be sent to the notary before the appointment. The notary will avert both sides if anything in the contract is not in line with law, or if there is anything damaging for any of the sides. Make sure you agreed on everything, the notary is not a place to negotiate, but to seal the agreement.
After the contract is signed, you can transfer the remaining amount to the seller, or whatever was the agreement. The property will be registered on your name 15 days (often more) after the notary has informed the register of the title change.
You will pay 3% transfer tax, but only in the case of the secondhand property. If you are buying directly from the developer, there is no transfer tax, as the property comes with a VAT included. If the purchase is made from the company, and for the purpose of renting, you can claim back the VAT.
The agency fee is paid by the seller, the buyers do not get charged in Montenegro.
Buying a property is an easy process if you have a professional by your side
Buying a Property in Montenegro as a Foreigner
As it is mostly known, there are no limitations for foreigners buying the property in Montenegro except for those limited exceptions regulated by the law (The Law on Ownership Rights):
Limitations of Foreign Persons’ Rights:
A foreign person cannot have an ownership right on:
- natural resource;
- goods in general use;
- agricultural land;
- forest and forest land;
- cultural monument of special importance;
- immovable property located in the area that is, for the purpose of protection of interests and safety of the country, proclaimed by law as the area that a foreign person cannot have the ownership right on.
- immovable things that is in the area of which is to protect the interests and security of the land law declared area in which a foreign person can not have the right to property.
Exceptionally, a foreign physical person may acquire the ownership right on agricultural land, forests and forest land of a surface up to 5,000 m2, only if a residential building located on this land is subject to the contract of divestiture (sale, gift, exchange, etc.).
Knowing this, you should also be aware that a purchase of the agricultural land can be made through a company.
Read more about the process of buying a land as a foreigner in Montenegro.
Buying a Property in Montenegro as an EU Citizen
The EU citizens, following the signing of the Stabilisation and Association Agreement between the European Communities and their Member States, of the one part, and the Republic of Montenegro, of the other part, have the same rights as nationals of Montenegro:
3. Montenegro shall, from the entry into force of this Agreement, grant national treatment to EU nationals acquiring real estate on its territory.
Thus, the limitations from the first part are not applicable to EU citizens.
Benefits of Buying A Property in Montenegro
The process of buying and selling a property in Montenegro is simple and fast. The taxes are very favorable, and thus, you will not incur major costs if do not use your property constantly. Further, there are no restrictions on rentals for foreign owners, and taxes are very low, this means you can let your property paying your vacation. You can rent it when you do not use it.
Montenegro has Euro as a currency, and the money earned from renting the property will not be diminished by the potential currency devaluations, very common for developing markets. The rental returns are steady and increasing constantly, as the tourism is increasing. Check here for all the benefits of the rental investment.
You can choose among variety of different properties: houses or apartments by the sea, apartments for rent in the capital, or a cottage in the North, surrounded by amazing nature and sceneries.
You can also buy all these options for less money than buying a property by the sea in some of the European touristic destinations. You will reach your properties in just few hours drive, maximum.
Typical assistance provided by a RE/MAX Associate
- Help you identify the most adequate property according to your needs and criteria;
- Arrange and guide you through the viewings;
- Provide you with further information regarding the property, update the information, follow up with the owner;
- Help you and carry out the negotiations making sure you get the best price for the property. Help you choose the lawyer, assist you with preliminary agreement and deposit.
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