Since its establishment in 2006, Montenegro has gained the prestigious status of leading Europe in terms of foreign investment per capita.

Recently there has been a surge of interest for the real estate market in Montenegro, which is now being considered as one of the fastest growing property markets in the world. Investors from Europe (UK, Russia), America and the Arab world have pumped hundreds of millions to this growing market in a bid to make quick and significant profits. It should be mentioned that a foreign investor can be the owner of real estate exactly like a Montenegrin citizen. Registration of real estate is complete just after payment of tax on the estimated value of the real estate.

In the past two years property prices have risen on average by 20%-30% per year. For instance, one of the main foreign investors in the market is More Fund. Local brokers conveyed that during May 2007 the Fund purchased a land plot in Drobni Pijesak area, a secluded 250 m long beach, which is accessible only from the sea. The Fund bought 1 sq. m. for 118 euro but as of late sold the area for about 400 euro per 1 sq. m..

Despite the significant price surge, the property prices for investors are still considered attractive.
 

The demand is steadily increasing for country-style properties on the coast due to the huge potential for the development of tourist projects. The most attractive locations for investors are areas near Lake Skadar, the old Royal Capital of Cetinje, and the tourist resorts in the North: Bjelasica, near Kolasin and Durmitor, at Zabljak. According to industry experts, the rising interest in the Montenegrin properties is not expected to ebb in the foreseeable future.

(First published in Financial Times GMM via www.menareport.com)