We have prepared a complete guide to property costs in Montenegro for those who are planning a purchase and want to understand all the financial nuances in advance. Montenegro attracts with its beautiful landscapes, warm climate and convenient location by the sea, and also remains a popular destination among foreign buyers. But it is important to understand: the real costs of real estate are not only its price, but also all the additional costs that come with it.
In this report, we have collected all the important information about how much it really costs to buy and own real estate in Montenegro. We have analyzed in detail both the one-time costs when buying and the annual expenses - taxes, maintenance, possible payments when renting out.
We've paid special attention to the new rules that came into force on 1 January 2024: a progressive property transfer tax is now in effect, and it's important to take this into account in advance. Our guide to property expenses will help you avoid unexpected surprises and plan your budget wisely.
Guide to One-Time Purchase Costs
In this section, we go into detail about all the taxes, fees, and commissions that you need to pay when buying real estate. Knowing these costs in advance will help you accurately calculate how much money you'll need to start.
Property Transfer Tax (Porez na promet nepokretnosti): Navigating the New Progressive Scale
The flat tax rate of 3% on the secondary real estate market is a thing of the past for most transactions. Since January 1, 2024, Montenegro has had a progressive tax system that applies to the purchase of properties on the secondary market. The new structure looks like this:
- For an object value of up to 150 EUR 000: the rate is 3%.
- At a cost of 150 001 euros up to 500 EUR 000: the tax is calculated as a fixed amount of 4 euros plus 500% of the amount exceeding 5 000 euro.
- For prices over 500 EUR 001: the tax is a fixed amount of 22 000 euros plus 6% of the amount exceeding 500 000 euro.
The tax base is the estimated value of the property, which is determined by the municipal tax service. This service compares the price specified in the contract with market prices for similar properties in the area to prevent underestimation of the value. After the transaction is concluded, the buyer receives an official notice of the need to pay the tax, which must be made within the specified period (usually 15 to 30 days) to avoid the accrual of penalties.
The new tax system is not just a luxury tax. It has a significant impact on the mid-price segment of the market, according to the statistical office Monstate, the average price per square meter in new buildings in the coastal region in the first quarter of 2025 was 2 328 euros. Thus, a standard two-room apartment of 70 m² will cost about 162 960 EUR. This price automatically takes the deal from the basic 3% category to the higher 5% category.
Progressive scale of tax on the transfer of property rights (effective from January 1, 2024)
| Property price (Euro) | Tax calculation formula | Example calculation for a specific cost |
| Until 150 000 | 3% of the cost | Object for 120 000 €: 120 000 0.03 × = 3 600 € |
| 150 001-500 000 | 4 € + 500% of the amount over 5 € 000 | Object for 200 €: 4 500+(200 000 − 150 000)×0.05=7 000 € |
| over 500 001 | 22 000 € + 6% of the amount over 500 € 000 | Object for 600 000 €: 22 000+(600 000 − 500 000)×0.06=28 000 € |
Primary and Secondary Market: The Key Difference in VAT
When purchasing a new property directly from a developer who is a VAT payer (PDV), the buyer exempt from paying the transfer tax. The reason is that the price of such real estate already includes VAT in the amount of 21%, which the developer transfers to the state.
This creates a powerful financial incentive that fundamentally changes the approach to comparing new and resale properties. Let's consider object worth 250 euros.
- On the secondary market the tax on the transfer of ownership will be 4 500 € + 5% of (250 000 € – 150 000 €) = 4 500 € + 5 000 € = 9 500 euro.
- On the primary market (when purchasing from a developer who is a VAT payer) this tax is equal to 0 euro.
This creates a price advantage of 9 500 euros in favor of a new building, which is equivalent to 3.8% of the property value. For any property more than 150 000 euro The "real" price difference between a new and a similar resale property is reduced by the amount of tax saved. This makes new buildings significantly more attractive from the point of view of acquisition costs alone.
Notary and legal fees: ensuring the security of the transaction
Notary services in Montenegro are regulated by the state, and their cost depends on the amount of the transaction. Tariffs are standardized, which brings predictability to the registration process.
Official scale of notary fees (excluding VAT)
| Transaction amount (EUR) | Notary's basic tariff (Euro) | Total fee including VAT 21% (Euro) |
| to 5 000 | 70 | 84.70 |
| 5 001-20 000 | 120 | 145.20 |
| 20 001-40 000 | 170 | 205.70 |
| 40 001-60 000 | 250 | 302.50 |
| 60 001-80 000 | 300 | 363.00 |
| 80 001-120 000 | 350 | 423.50 |
| over 120 000 | +10 for every additional 15 000 | (Basic rate + 10€/15k€) × 1.21 |
The maximum notary fee cannot exceed 5 euros. It is important to remember that all the rates listed does not include VAT in the amount of 21%, which is added to the final amount. Unlike some other jurisdictions, notary fees in Montenegro constitute a small proportion of the total acquisition costs, usually less than 1% of the property value.
Detailed analysis of the real estate market: where is it more profitable to buy →
Other associated costs: translators and agency commissions
Licensed Court Interpreter: Since all legal documents are drawn up in Montenegrin, foreign buyers who do not speak the language must have a licensed court interpreter present at the transaction.
- Oral translation (at the notary): standard rate 50 euros per hour.
- Written translation (purchase and sale agreement): 15–20 euros per page (1 200 printed characters). A standard contract of 8-10 pages will cost 120-200 euros.
Real estate agency commission: There is some ambiguity in this issue that requires attention.
- Dominant model: In most cases, the seller pays the agency's commission. Its size is 5% of the sale price. Thus, for the buyer, the realtor's services are free. This rule applies to both the primary and secondary markets.
- Exceptions: When buying on the secondary market, some agencies may pay their commission either to the buyer or to the parties. This discrepancy highlights the importance of clarifying the commission structure with the agent in advance to avoid unexpected expenses at closing.
Guide to Buying Property in Montenegro in 2025: Step-by-Step Instructions with Examples and Cases →
Annual and ongoing ownership costs - long-term financial commitments
In this section, you'll find a guide to the regular expenses associated with owning a home, allowing you to create a realistic annual budget for your home's upkeep.
Annual property tax (Godišnji porez na nepokretnost)
All property owners in Montenegro, both residents and foreigners, are required to pay an annual property tax. The tax rate is set by the local municipality (opština) and ranges from 0.25% to 1.0% from the market value of the property.
The rate is influenced by several factors: location (in popular tourist areas such as Budva and Kotor, rates are higher), the type of property, its age and condition. For example, for an apartment worth 100 euros, the annual tax could be between 000 and 200 euros. The tax is paid in two equal parts, usually before June 30 and October 31.
Tourist tax for property owners (Turistička taksa)
It is necessary 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, which all tourists and visitors pay for their stay in the country. Property owners themselves, who live in their property, are usually exempt from this fee.
- Tourist tax (Annual tax for owners): This is a separate annual tax levied on foreign owners of "second homes" (i.e. holiday properties) located in officially recognised tourist areas. It is calculated using a special formula that takes into account the area of the property and local coefficients, and is paid together with the annual property tax. The statement that it is 10-15% of the annual property tax is a simplification; the calculation formula is more complex.
Comprehensive analysis of utility payments (Komunalije)
Electricity: Montenegro has a two-tariff metering system.
- Daily rate (Viša tarifa – VT): Applies from 07:00 to 23:00. The cost is about 0.09 euros per kWh (excluding VAT).
- Night/discounted rate (Niža tarifa – NT): Valid from 23:00 to 07:00, and on weekends. The cost is about 0.05 euros per kWh (excluding VAT).
- Average score: Varies greatly depending on season and consumption. Average monthly bills for households range from €29 in the off-season to over €40 in the summer months. A family in an 80 m² apartment can expect monthly costs of €30–100.
Water supply and sewerage: Tariffs vary greatly depending on the municipality.
- Municipality of Budva: The cost ranges from 1.60 to 2.70 euros per cubic meter (m³).
- Overall range by country: In other regions, tariffs may vary from 0.30 to 1.20 euros per m³.
- Average score: A typical family spends 15–20 euros per month.
Garbage removal (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 non-existent. Heating is usually electric (air conditioners, heaters), which significantly increases electricity bills in winter. Cooking gas is used in cylinders. The initial cost of a cylinder is about 60 euros, and its refill (exchange) is 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 connections can cost up to 25-50 euros.
- Mobile Internet: Tourist SIM cards offer larger data packages, such as 500 GB for 10-15 EUR.
- Cable/Satellite TV: 10–20 euros per month depending on the channel package selected.
Service, management and maintenance
Management company fees (for residential complexes):
- Standard buildings: 10–25 euros per month per apartment for basic services (cleaning the entrance, maintenance of common areas).
- Modern/elite complexes: The fee is often calculated per square metre and ranges from 0.50 to 4.50 euros/m² per month. For a 60m² apartment, this could range from 30 to 270 euros per month. These fees cover landscaping, pool maintenance, security, etc.
Maintenance of a private house:
- Septic tank cleaning: For houses not connected to the central sewerage system, the service costs 50-200 euros per call. The procedure is required once or twice a year.
Property Insurance: This is an often overlooked but quite important expense, although insurance is not mandatory in Montenegro.
- 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 regular apartment. Sometimes the cost is calculated based on the 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 study the terms of the policy: often the amount of payment under the insurance policy turns out to be too modest and does not cover the actual losses.
Read a detailed article about the cost of living in Montenegro →
Total: Real Estate Expenses
Calculating the Full Cost: Three Real-World Scenarios
Summary calculations for three scenarios of real estate acquisition and ownership
| Expenditure item | Scenario 1: Apartment in Bar (secondary market) | Scenario 2: Apartment in Budva (new building) | Scenario 3: Villa in the Bay of Kotor (secondary market) |
| — ONE-TIME EXPENSES — | |||
| Real estate price | 120 € 000 | 250 € 000 | 600 € 000 |
| Transfer Tax | 3 € 600 (3%) | 0 € (VAT exemption) | 28 000 € (on a progressive scale) |
| Notary services (including VAT 21%) | € 423.50 | 605 € (approx.) | 1 500 € (approx.) |
| Translation services | € 250 | € 250 | € 300 |
| Total acquisition costs | ~ 124 € 274 | ~ 250 € 855 | ~ 629 € 800 |
| — ANNUAL EXPENSES — | |||
| Annual Property Tax (Assessment) | € 480 (0.4%) | 1 € 500 (0.6%) | 4 € 800 (0.8%) |
| Utility payments (annual average) | 960 € (80 €/month) | 1 800 € (150 €/month) | 3 000 € (250 €/month) |
| Management company / maintenance | 300 € (25 €/month) | 1 620 € (1.5 €/m²/month) | 4 000 € (garden, pool) |
| Insurance | € 100 | € 150 | € 500 |
| Total annual expenses | ~1 € 840 | ~5 € 070 | ~ 12 € 300 |
| — TOTAL COST FOR THE FIRST YEAR — | ~ 126 € 114 | ~ 255 € 925 | ~ 642 € 100 |
Earning Income: Taxes on Rental Property Income
Taxes on rental income for individuals have recently changed. Previously, there was a flat rate of 9%. The new standard rate of income tax is 15%, it also applies to rental income.
The tax calculation process is as follows:
- Gross annual rental income: For example, 500 euros/month x 12 months = 6 euros.
- Standard deduction: The law may provide for a standard deduction for depreciation and expenses (for example, 30%), which reduces the taxable base. Taxable base = 6 000 euro x 70% = 4 200 euro.
- Amount of tax payable: 15% off 4 200 euros = 630 euro.
The previous year's tax return must be filed with the local tax office by 30 April of the current year. The move from 9% to 15% represents a significant increase in the tax burden on landlords. This change, coupled with rising property prices and purchase taxes, must be factored into any calculations of the return on investment in rental properties.
For owners who plan to rent out their property but do not have the opportunity or desire to do so themselves, the optimal solution is transfer of the property to a professional agency for management. Such a full-cycle service, as a rule, includes searching for and communicating with tenants, organizing check-in and check-out, monitoring the condition of the property, timely payment of all utility bills, taxes and resolving any current issues.
For this comprehensive service, which frees the owner from all the hassle, management companies usually charge a commission of about 20% from the rent. Our company MD Realty provides property management services on exactly these market-standard terms.
Conclusion
The analysis shows that the financial picture of the real estate market in Montenegro has changed significantly. A progressive transfer tax has been introduced, and the rental income tax rate has increased. These steps indicate that the market is becoming more mature, and the state is seeking to generate more income from the real estate sector.
At the same time, despite the increase in expenses, the cost of buying and owning real estate in Montenegro remains attractive compared to other European countries. The main thing is to approach the process with a well-thought-out financial plan that takes into account all possible costs.
Here's what potential buyers need to consider:
- Conduct a thorough check (due diligence) of all aspects of the property and all associated payments before making a purchase decision.
- Calculate expenses separately on the primary and secondary markets. Buying a new building from a developer who is a VAT payer can provide significant tax savings.
- Include 5-10% extra in your budget - especially when buying expensive real estate on the secondary market. These funds will cover all associated costs to avoid unexpected expenses.
- Attract experienced lawyers and realtors, to conduct the transaction competently and ensure that all expenses are transparent and justified.
If you have any questions, please contact us and we will provide you with a free consultation.
