Buying Property in Montenegro?
Great info about buying Montenegro property!

Buying a property in Montenegro is actually easier than you might imagine. Despite not being a member of the European Union, Montenegro and the UK have a reciprocal agreement in place which means that UK individuals are free to buy and sell property at will, across the country. This freedom does not extend to land and, therefore, any UK investor looking to buy land will have to set up a Montenegrin company in order to facilitate the purchase.

The actual process of purchasing in Montenegro is relatively familiar to most UK buyers, as it has the same deposit then completion stages as most other European countries. The deposit is normally ten percent, although this can be negotiated, individually, particularly with new build developers.

Buying Property in Montenegro - The How To

One difference that should be clearly understood is that the penalties for failure to complete, having offered a deposit, are slightly more stringent than in the UK, particularly for the seller. If the buyer fails to provide the rest of the funds by the date agreed at the time of the deposit being paid, he loses his deposit.

If the seller fails to complete, he will have to return the deposit plus a ten percent penalty. These rigid timescales, therefore, must be adhered to, if you are not to lose a substantial amount of money!

As Montenegro is not yet as developed as much of the rest of Europe, there are, inevitably, certain risks involved in investing in property here. Land registration is not yet required in Montenegro, although a registry does exist. The lack of required registration can lead to potential ownership disputes and unregistered land should be treated with considerable caution.

During Tito’s time in power, he claimed a large amount of private land and there are still cases ongoing of families taking legal action against the government in an attempt to reclaim their land. Whilst this does not directly affect foreign purchasers, it does present another potential avenue for dispute.

Although foreigners are free to purchase land in Montenegro, generally, there are some areas of land that are protected because they are of national and historical significance. It is not immediately apparent whether land or buildings are protected in this way and only a careful search of local council records is likely to reveal this potential issue.

Valuing a property in Montenegro is also particularly difficult because there are no national guidelines available. This means that agents and sellers can simply choose whatever price they like. Your own research and possibly the assistance of a buying agent will, therefore, be fundamental to the success of your investment.

Montenegro is one of those countries where local advice is vital. Enlisting the help of a good lawyer who can check the title and make sure that the property can be purchased by foreigners before you part with your deposit is considered essential. Surveys are not always undertaken in Montenegro; however, due to the varying standards and ages of property, any investor would be very wise to obtain their own full survey, before exchange.

Additional costs of purchase in Montenegro as with most other countries include legal, survey and notary fees. There is an additional two percent property tax which must be paid and this percentage is calculated based on the Montenegrin Inland Revenue’s valuation and not on the actual sale price. Bear in mind that this increases to seventeen percent tax for a new build.

Learning how to buy a property in Montenegro is relatively easy; but with potentially a few glaring pitfalls, it really pays to seek professional advice, sooner rather than later.