Montenegro's real estate market has been recording strong price growth for several years, and announcements that the country could become an EU member by 2028 are further intensifying interest from buyers and investors. Croatia's experience, which has been in the EU since 2013, shows that accession can bring significant growth in real estate prices - from about 30% up to over 60% depending on location.
The current state of Montenegro's market already shows dramatic changes. The average price of new construction jumped from ~951 €/m² in 2020 to about 2,158 €/m² at the beginning of 2025, which is a growth of 126% in just five years. This dynamic raises the question of how EU membership will additionally impact the already heated market.
Current Real Estate Prices in Montenegro
| Location | Price (€/m²) | Status |
|---|---|---|
| Budva center | 3,500-5,500 € | High demand |
| Kotor Old Town | 4,500-8,000 € | Premium zone |
| Porto Montenegro | 6,000-12,000 € | Luxury complex |
| Podgorica City Kvart | 1,800-2,500 € | Stable |
| Bar/Ulcinj | 1,300-2,200 € | Most affordable |
Croatia's Experience: A Model for Montenegro
Croatia became an EU member in 2013 and has since experienced continuous growth in real estate prices. Croatia recorded significant growth in real estate prices after joining - from about 30% up to over 60% depending on location. The biggest jump occurred in attractive coastal areas and larger cities.
Current data shows that the trend continues. In the last year, from the third quarter of 2023 to the third quarter of 2024, real estate prices in Croatia increased by as much as 12 percent, making Croatia take first place in the eurozone. Real estate prices in Croatia increased by 79.9% in the period from 2015 to 2023.
Croatia - Growth after EU accession
Montenegro - Current state
Specificities of Montenegro's Market
Montenegro has several key characteristics that distinguish it from other EU membership candidates:
Foreign buyers make up as much as 80% of all real estate transactions, while domestic buyers are a minority in the market. The main foreign investors come from economically stronger countries (USA, Western Europe, but also the region - e.g., Serbia, Russia, Turkey) and have much greater purchasing power than the average citizen of Montenegro.
Square meter prices in Montenegro are still below the European average, especially compared to Mediterranean EU members. This means there is room for growth - Montenegro is relatively more affordable and attractive to buyers looking for Mediterranean real estate at a lower price before it potentially becomes more expensive.
Did you know?
Montenegro has 392,909 apartments, but only 214,530 (72.72%) are used for permanent residence. In coastal municipalities Bar, Budva, Herceg Novi, Ulcinj, Tivat and Kotor there are the most seasonal apartments - in these cities over 45% of the housing stock is not intended for permanent residence.
Predictions for the 2026-2028 Period
A sudden jump of 50% immediately upon entry is not the rule - but significant growth of several tens of percent over the coming years is a realistic scenario, judging by regional examples. Real estate agent Mirko Vujović emphasizes: "I don't expect a price drop, but rather slight growth, and I especially expect significant increase in 2028 when Montenegro enters the European Union (EU)".
Medium-term and long-term, EU membership can further accelerate the trend of real estate value growth: economic growth of the country, rising living standards of citizens and greater inflow of foreign capital will gradually increase purchasing power and demand, and thus prices per square meter. The experiences of countries that joined the EU suggest that the next 5-10 years after accession could bring significant changes to the market - perhaps not immediate +50%, but cumulatively possibly even more than that.
Strategies for Investors
Short-term strategy
- ✓ Purchase before 2028
- ✓ Focus on coastal locations
- ✓ Ulcinj/Bar as cheapest
Medium-term strategy
- ✓ Rental to tourists
- ✓ 6-10% annual yield
- ✓ Location diversification
Long-term strategy
- ✓ Capital gain 30-60%
- ✓ EU quality standards
- ✓ Stable legal environment
Real Estate Purchase Costs
Real estate purchase costs in Montenegro
- ✓ Transfer tax: 3% for properties up to 150,000 €, 5% for the portion from 150,000 € to 500,000 € and 6% for the portion over 500,000 €
- ✓ Notary costs: 150-300€
- ✓ VAT on new construction: 21% (exemption for first-time housing solution up to 20 m² per household member)
- ✓ Foreigners can buy real estate without restrictions
Rental Potential
The tourist season in Montenegro enables solid returns from property rentals. Studio apartments rent for 350-450 euros, while one-bedroom apartments cost around 500-600 euros monthly, and three-bedroom apartments over 1,000 euros. According to estimates from the knowledge base, annual net rental yield in Budva and Kotor ranges from 6-10%, which is significantly higher than the European average.
"The most sought-after locations are Budva, Kotor and Tivat, while the most expensive square meters are in luxury complexes like Porto Montenegro, Porto Novo, Luštica Bay and Dukley Gardens, where prices reach up to 12,000 euros per square meter. Last year in Budva, for example in the Rozino settlement, a square meter was 2,950 euros, now it's 3,200-3,250.
— Mirko Vujović, Real Estate Agent
EU Negotiation Status
Montenegro closed five negotiating chapters in December last year, bringing their total number to 12. The government in Podgorica wants to complete the negotiation process by the end of 2026 and become the 28th member of the Union in 2028. EU foreign policy chief Kaja Kallas stated that Montenegro is "the most prepared of all candidate countries for EU membership". Commissioner for Enlargement Marta Kos added that the moment is approaching when Brussels will begin preparations for concluding an Accession Treaty with Montenegro.
Risks and Challenges
Experts warn that such high prices already exclude many domestic buyers and reduce their interest. Money flows into "square meters" rather than production facilities; apartment prices grow faster than salaries; almost every fourth apartment stands empty, while tens of thousands of families live as tenants or with relatives.
The market is already heated and prices are at record levels; the challenge will be how to harness the investment wave that EU brings while mitigating negative consequences (e.g., housing unaffordability for citizens). New construction and projects (state and private) are needed to increase supply and prevent uncontrolled price growth - otherwise, there's a threat of a scenario where the average citizen can hardly afford an apartment in their own country.
Montenegro's accession to the European Union in 2028 represents a significant opportunity for real estate investors. Croatia's experience shows that price growth of 30-60% can be expected, especially in attractive coastal zones. Current prices in Montenegro are still below the European average, leaving room for growth. However, investors should be aware that the market is already overheated, with 126% growth in the last five years. The key is proper timing - purchasing before official accession can bring significant capital gains, while renting during tourist season enables solid annual returns of 6-10%.
