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Investment strategies
Montenegro is a friendly country with a pleasant climate and is often considered for home ownership.
To invest in foreign real estate, first of all, you need to analyze the market and choose an investment strategy. The formats most often considered by buyers are:
- to move their finances into overseas assets;
- to invest and grow your finances.
In the first case, the main goal of a real estate buyer is to preserve finances and keep them safe from inflation.
Investing in square meters abroad is always profitable: funds can be converted into currency when selling.
It has happened that clients have bought real estate for €100,000, for example, when the exchange rate was 80 roubles per euro. And they sold it when the exchange rate rose to 100 roubles per euro. Even if the sale was at the same value as the purchase, the seller benefited from the difference in exchange rates.
In the format of saving finances, the buyer needs to choose an object that will not lose much in value in the long run.
Investing in square meters abroad is always profitable: funds can be converted into currency when selling.
It has happened that clients have bought real estate for €100,000, for example, when the exchange rate was 80 roubles per euro. And they sold it when the exchange rate rose to 100 roubles per euro. Even if the sale was at the same value as the purchase, the seller benefited from the difference in exchange rates.
In the format of saving finances, the buyer needs to choose an object that will not lose much in value in the long run.
When an investor adheres to the second model, where in addition to capital preservation, he wants to get a gain, there are two options for getting this gain: reselling the property at a higher value or renting it out.
But these formats can also be combined
Example. Buying a property at the excavation stage at a low price. After the construction is completed, the cost of the apartment will increase by 30%. When rented out, ROI (Return on Investment) can be increased.
In addition, it is necessary to understand the turnover time of funds. If the buyer aims at return and growth of investments in a short time, other options are suitable for such transactions:
But these formats can also be combined
Example. Buying a property at the excavation stage at a low price. After the construction is completed, the cost of the apartment will increase by 30%. When rented out, ROI (Return on Investment) can be increased.
In addition, it is necessary to understand the turnover time of funds. If the buyer aims at return and growth of investments in a short time, other options are suitable for such transactions:
- Flipping real estate. This can be a house or apartment that needs renovation or repair. When choosing such a property, it is important to understand pricing. The cost of the property and the price for repairs should allow you to generate income and still remain in the price delta of the market. The turnover cycle of funds, which includes purchase, repair and further resale, is 3-6 months.
- Apartments under construction. The price of such objects grows during 1.5-2 years: from the excavation stage to the completion of construction.
Regions for investment
Montenegro's climatic zones offer different options for real estate investments and returns.
Coastal regions with a rental strategy
Budva is the main tourist city of the country. Therefore, most of the apartments are purchased by investors with the purpose of renting them out: both long-term and seasonal.
There is also an active sale of secondary real estate. The only nuance: it is not recommended to buy apartments in Budva to obtain a residence permit. Since there are many transactions in this riviera, the re-registration of ownership in the cadastre can take up to two years. And it is impossible to apply for a residence permit without a title deed.
Budva is the main tourist city of the country. Therefore, most of the apartments are purchased by investors with the purpose of renting them out: both long-term and seasonal.
There is also an active sale of secondary real estate. The only nuance: it is not recommended to buy apartments in Budva to obtain a residence permit. Since there are many transactions in this riviera, the re-registration of ownership in the cadastre can take up to two years. And it is impossible to apply for a residence permit without a title deed.
In the second case, it is better to choose real estate on the coast, as the main demand falls on popular tourist riviera: Budva, Bar, Herceg Novi, Tivat.
If the client is set up for the long term, then the central and northern parts of the country can be chosen. And the emphasis shifts towards land plots.
If the client is set up for the long term, then the central and northern parts of the country can be chosen. And the emphasis shifts towards land plots.
Coastal regions with price growth strategy
If we talk about investment potential with a strategy of price growth, it is better to consider regions where the surge has not yet occurred and prices have not reached the upper limit. In this format, the most interesting for investment are Bar, Ulcinj and Sutomore.
If we talk about investment potential with a strategy of price growth, it is better to consider regions where the surge has not yet occurred and prices have not reached the upper limit. In this format, the most interesting for investment are Bar, Ulcinj and Sutomore.
Capital region with long-term lease strategy
Podgorica is not a popular tourist destination. However, the metropolitan area is suitable for a conservative long-term rental strategy.
Podgorica is not a popular tourist destination. However, the metropolitan area is suitable for a conservative long-term rental strategy.
Central regions with prospects for investment in land plots
Regions such as Podgorica, Danilovgrad, Zeta are famous for spacious land. For example, it is almost impossible to find land with the area of 2 thousand square meters on the coast. But in the center of the country there are a lot of such offers.
What are the prospects for buying such a property?
First, when the building boom begins in these locations, land values will increase.
Secondly, the plot can be leased out for a long-term period for some kind of production or resold to a major player. For example, over the last two years, the Lidl retail chain bought three land plots in the central region.
Thirdly, the construction of commercial or warehouse space for future leasing.
Regions such as Podgorica, Danilovgrad, Zeta are famous for spacious land. For example, it is almost impossible to find land with the area of 2 thousand square meters on the coast. But in the center of the country there are a lot of such offers.
What are the prospects for buying such a property?
First, when the building boom begins in these locations, land values will increase.
Secondly, the plot can be leased out for a long-term period for some kind of production or resold to a major player. For example, over the last two years, the Lidl retail chain bought three land plots in the central region.
Thirdly, the construction of commercial or warehouse space for future leasing.
Northern regions as an alternative to the coast
The north of Montenegro is becoming increasingly popular with investors. Here you can buy apartments for rent, a chalet-style house or a plot of land with the prospect of building a house.
Kolasin ski tourism gives a good ROI, which falls mainly in the winter period. Žabljak rents non-stop both in winter and summer: the national parks and lakes of this region attract tourists from Europe and China, not excluding the flow of domestic tourism.
The north of Montenegro is becoming increasingly popular with investors. Here you can buy apartments for rent, a chalet-style house or a plot of land with the prospect of building a house.
Kolasin ski tourism gives a good ROI, which falls mainly in the winter period. Žabljak rents non-stop both in winter and summer: the national parks and lakes of this region attract tourists from Europe and China, not excluding the flow of domestic tourism.
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