Complete Guide to Real Estate Costs in Montenegro (2025): for Investors and Buyers
We have prepared a complete guide to real estate costs in Montenegro for those planning a purchase and who want to understand all the financial details in advance. Montenegro attracts buyers with its beautiful landscapes, warm climate, and convenient location on the Adriatic...
We have prepared a complete guide to property expenses in Montenegro for those planning to buy and wanting to understand all financial nuances in advance. Montenegro attracts buyers with its beautiful landscapes, warm climate, and convenient seaside location, and remains a popular destination among foreign buyers. But it is important to understand: the real costs of property are not only its price, but also all the additional expenses that come with it.
In this report, we have gathered all the important information about how much it really costs to buy and own property in Montenegro. We have broken down in detail both one-time purchase costs and annual expenses — taxes, maintenance, and possible payments when renting out.
We paid special attention to the new rules that came into force on January 1, 2024: a progressive property transfer tax now applies, and this is important to take into account in advance. Our property expense guide will help you avoid unexpected surprises and plan your budget wisely.
Guide to one-time purchase costs
In this section, we take a detailed look at all the taxes, fees, and commissions that need to be paid when purchasing property. Knowing about these expenses in advance will allow you to calculate exactly how much money will be needed at the start.
Property transfer tax (Porez na promet nepokretnosti): navigating the new progressive scale
The flat 3% tax rate on the secondary property market is now a thing of the past for most transactions. Since January 1, 2024, Montenegro has had a progressive tax system that applies when buying secondary-market properties. The new structure is as follows:
For properties priced up to 150,000 euros: the rate is 3%.
For properties priced from 150,001 euros to 500,000 euros: the tax is calculated as a fixed amount of 4,500 euros plus 5% of the amount exceeding 150000 euros.
For properties priced above 500,001 euros: the tax is a fixed amount of 22000 euros plus 6% of the amount exceeding 500000 euros.
The tax base is the assessed value of the property, determined by the municipal tax authority. This authority compares the price stated in the contract with market prices for similar properties in the area in order to prevent undervaluation. After the transaction is completed, the buyer receives an official notice of the tax payment obligation, which must be paid within the specified period (usually 15 to 30 days) to avoid penalties.
The new tax system is not just a luxury tax. It has a significant impact on the mid-range segment of the market. According to data from the statistical office Monstat, the average price per square meter in new-build properties in the coastal region in the first quarter of 2025 was 2328 euros. Thus, a standard two-bedroom apartment of 70 m² will cost around 162960 euros. This price automatically moves the transaction out of the basic 3% category into the higher 5% one.
Progressive property transfer tax scale (effective from January 1, 2024)
Primary and secondary markets: the key difference in VAT
When buying a new property directly from a developer who is a VAT (PDV) payer, the buyer is exempt from paying the property transfer tax. The reason is that the price of such property already includes 21% VAT, which the developer remits to the state.
This creates a powerful financial incentive that fundamentally changes the approach to comparing new and secondary properties. Let us consider a property worth 250,000 euros.
On the secondary market the property transfer tax will be 4500 € + 5% of (250000 € - 150000 €) = 4500 € + 5000 € = 9,500 euros.
On the primary market (when buying from a VAT-paying developer), this tax is 0 euros.
Thus, there is a price advantage of 9500 euros in favor of the new-build, which is equivalent to 3.8% of the property price. For any property more expensive than 150000 euros the “real” price difference between a new and a comparable secondary property is reduced by the amount of tax saved. This makes new-builds significantly more attractive from the standpoint of acquisition costs alone.
Notary and legal fees: ensuring transaction security
Notary services in Montenegro are regulated by the state, and their cost depends on the transaction amount. The fees are standardized, which makes the registration process predictable.
Official notary fee scale (excluding VAT)
The maximum notary fee cannot exceed 5,000 euros. It is important to remember that all listed fees do not include VAT of 21%, which is added to the final amount. Unlike in some other jurisdictions, notary fees in Montenegro make up a small share of the total acquisition costs, usually less than 1% of the property price.
Other related expenses: translators and agency commissions
Licensed court translator: Since all legal documents are drawn up in Montenegrin, the presence of a licensed court translator is mandatory for foreign buyers who do not speak the language.
Oral translation (at the notary): standard rate 50 euros per hour.
Written translation (purchase agreement): 15–20 euros per page (1200 printed characters). A standard contract of 8–10 pages will cost 120–200 euros.
Real estate agency commission: There is some ambiguity on this issue that requires attention.
Dominant model: In most cases, the seller pays the agency commission. Its amount is 5% of the sale price. Thus, for the buyer, realtor services are free of charge. This rule applies to both the primary and secondary markets.
Exceptions: When buying on the secondary market, some agencies may charge the buyer, or the commission may be split between the parties. This discrepancy highlights the importance of clarifying the commission structure with the agent in advance to avoid unforeseen expenses at closing.
Annual and ongoing ownership costs — long-term financial obligations
In this section you will find a guide to regular expenses associated with property ownership, which will allow you to create a realistic annual budget for its maintenance.
Annual property tax (Godišnji porez na nepokretnost)
All property owners in Montenegro, both residents and foreigners, are required to pay annual property tax. The tax rate is set by the local municipality (opština) and ranges from 0.25% to 1.0% of the market value of the property.
Several factors affect the rate: location (rates are higher in popular tourist areas such as Budva and Kotor), property type, age, and condition. For example, for an apartment worth 100,000 euros, the annual tax may amount to 200 to 350 euros. The tax is paid in two equal installments, usually by June 30 and October 31.
Tourist tax for property owners (Turistička taksa)
It is important to clearly distinguish between two types of fees that are often confused:
Boravišna taksa (tourist registration fee): This is a daily fee of 1 euro per person, paid by all tourists and visitors for staying in the country. Property owners themselves, when living in their own property, are generally exempt from this fee.
Turistička taksa (annual tax for owners): This is a separate annual tax levied on foreign owners of “second homes” (i.e., holiday properties) located in officially recognized tourist zones. It is calculated using a special formula that takes into account the property area and local coefficients, and is paid together with the annual property tax. The statement that it amounts to 10–15% of the annual property tax is an oversimplification; the calculation formula is more complex.
Comprehensive analysis of utility payments (Komunalije)
Electricity: Montenegro uses a two-tariff metering system.
Day tariff (Viša tarifa - VT): Applies from 07:00 to 23:00. The cost is about 0.09 euros per kWh (excluding VAT).
Night/reduced tariff (Niža tarifa - NT): Applies from 23:00 to 07:00, as well as on weekends. The cost is about 0.05 euros per kWh (excluding VAT).
Average bill: Varies greatly depending on the season and consumption. Average monthly bills for households range from 29 euros in the off-season to more than 40 euros in the summer months. A family in an 80 m² apartment can expect monthly costs of 30–100 euros.
Water supply and sewerage: Rates vary greatly depending on the municipality.
Municipality of Budva: The cost ranges from 1.60 to 2.70 euros per cubic meter (m³).
General range across the country: In other regions, rates may vary from 0.30 to 1.20 euros per m³.
Average bill: A typical family spends 15–20 euros per month.
Waste collection (Odvoz smeća): This is a modest monthly payment.
For an apartment: 5–10 euros per month.
For a private house: 10–12 euros per month. In some municipalities, the calculation is based on area, for example, 0.06 euros/m².
Heating and gas: Central heating and gas supply are practically absent. Heating is usually electric (air conditioners, heaters), which significantly increases electricity bills in winter. Gas for cooking is used in cylinders. The initial cost of a cylinder is about 60 euros, and refilling (exchange) costs 12–15 euros.
Communication: Internet and television
The cost of communication services in Montenegro is competitive.
Home internet: Basic packages cost 15–25 euros per month. High-speed fiber-optic connection can cost up to 25–50 euros.
Mobile internet: Tourist SIM cards offer large data packages, for example, 500 GB for 10–15 euros.
Cable/satellite TV: 10–20 euros per month depending on the chosen channel package.
Maintenance, management, and upkeep
Management company fees (for residential complexes):
Standard buildings: 10–25 euros per month per apartment for basic services (stairwell cleaning, maintenance of common areas).
Modern/luxury complexes: Payment is often calculated per square meter and ranges from 0.50 to 4.50 euros/m² per month. For a 60 m² apartment, this can amount to 30 to 270 euros per month. These fees cover landscaping, pool maintenance, security, etc.
Private house maintenance:
Septic tank cleaning: For houses not connected to the central sewer system, the service costs 50–200 euros per call. The procedure is required once or twice a year.
Property insurance: This is often overlooked, but a rather important expense item. Although insurance in Montenegro is not mandatory.
Cost: Basic insurance can cost as little as 24 euros per year, while more comprehensive packages with coverage, for example, against earthquakes, cost around 135–150 euros for a typical apartment. Sometimes the cost is calculated by area and ranges from 0.52 to 1.98 euros per square meter per year — it all depends on the level of protection. But it is important to carefully review the policy terms: often the payout under the insurance policy turns out to be too modest and does not cover the actual losses.
Summary calculations for three scenarios of purchasing and owning property
Earning income: taxes on rental property income
Taxes on rental income for private individuals have recently been changed. Previously, a flat rate of 9% applied. The new standard income tax rate is 15%, and it also applies to rental income.
The tax calculation process is as follows:
Gross annual rental income: For example, 500 euros/month × 12 months = 6,000 euros.
Standard deduction: Legislation may provide for a standard deduction for depreciation and expenses (for example, 30%), which reduces the taxable base. Taxable base = 6000 euros × 70% = 4200 euros.
Tax amount payable: 15% of 4200 euros = 630 euros.
The tax return for the previous year must be filed with the tax authorities at the location of the property by April 30 of the current year. The shift from 9% to 15% represents a significant increase in the tax burden on landlords. This change, combined with rising property prices and purchase taxes, should be taken into account in any calculations of rental property investment returns.
For owners who plan to rent out their property but do not have the ability or desire to manage it themselves, the optimal solution is to hand the property over to a professional management agency. Such a full-cycle service typically includes finding and communicating with tenants, arranging check-in and check-out, monitoring the condition of the property, timely payment of all utility bills and taxes, and resolving any current issues.
For this comprehensive service, which frees the owner from all hassles, management companies usually charge a commission of about 20% of the rental income. Our company MD Realty provides property management services on exactly these standard market terms.
Conclusion
The analysis shows that the financial picture of the real estate market in Montenegro has changed noticeably. A progressive property transfer tax has been introduced, and the tax rate on rental income has increased. These steps indicate that the market is becoming more mature, and the state is seeking to generate more revenue from the real estate sector.
At the same time, despite rising costs, the cost of buying and owning property in Montenegro remains attractive compared with other European countries. The main thing is to approach the process with a well-thought-out financial plan that takes into account all possible expenses.
Here is what potential buyers should take into account:
Carry out a thorough due diligence (due diligence) of all aspects of the property and all related payments before making a purchase decision.
Calculate expenses separately for the primary and secondary markets. Buying a new-build from a VAT-paying developer can provide significant tax savings.
Budget an extra 5–10% — especially when buying expensive secondary-market property. These funds will cover all related expenses and help avoid unexpected costs.
Engage experienced lawyers and real estate agents, to handle the transaction properly and ensure that all costs are transparent and justified.
If you still have questions, contact us and we will provide a free consultation.
