In the second quarter of this year (April – June), the average price per square meter for new apartments in Montenegro reached 2,201 euros, with Podgorica’s average standing at 2,108 euros, as reported by the Statistical Office of Montenegro.

Price comparisons show an increase of approximately two percent from the previous quarter (January – March), and a significant rise of 20 percent or 350 euros per square meter compared to the same quarter last year. Since the start of 2023, the average price per square meter has surged by 50 percent, equating to around 700 euros, with values recorded at 1,341 euros in Montenegro and 1,407 euros in Podgorica.

There were no sales from solidarity union funds this quarter, which had a price per square meter of 674 euros in the first quarter of this year.

As per June data, acquiring one average square meter of an apartment necessitates nearly two and a half average salaries (1,010 euros), three and a half minimum wages (600 euros), and four average pensions (536 euros).

Foreigners Maintain Price Levels

A source from the construction sector told Vijesti that prices have remained relatively stable over the last six months following significant increases in 2023 and 2024, largely due to persistent demand from foreign buyers. There has also been a noted uptick in sales to local citizens who are securing housing loans.

According to official data from the Central Bank’s balance of payments, foreigners invested 228 million euros in Montenegrin real estate during the first half of this year, a rise of 29 million euros year-on-year.

Real estate purchases by foreigners came from 60 different countries, with Serbian investors leading at 41.3 million euros. Following them were investors from Turkey (29.5 million euros), the United States (24 million euros), Germany (20.6 million euros), the United Arab Emirates (11.1 million euros), Russia (10.4 million euros), Switzerland (8.9 million euros), and Great Britain (8.2 million euros), among others.

Increase in Approved Housing Loans

Data from the Central Bank indicate that Montenegro’s banks approved housing loans totaling 109 million euros in the first half of this year, which is an increase of approximately 26 million euros compared to the same timeframe last year.

The average effective interest rate on new housing loans in June was 5.06 percent, down from 5.63 percent a year prior. This is the lowest monthly interest rate for housing loans in two years, excluding May of last year when it was recorded at 4.67 percent.

Coastal Prices at 2,333 Euros; Nikšić at 960 Euros

In the coastal region, the average price per square meter for newly built apartments in the second quarter of this year was 2,333 euros, reflecting a ten percent increase from the same period last year, which saw prices at 2,107 euros.

In the central region (excluding Podgorica), which encompasses Cetinje, Danilovgrad, Nikšić, Tuzi, and Zeta, the new construction average price per square meter was 1,068 euros, rising from 960 euros last year.

The northern region, which includes municipalities like Andrijevica, Berane, Bijelo Polje, and Gusinje, reported an average price of 1,547 euros per square meter for new apartments, a jump from no sales recorded last year. At the start of 2024, the price was 1,200 euros per square meter.

Are Construction Costs Twice as High in PG vs. NK?

Monstat acquires pricing data on newly built apartments from purchase contracts between buyers and investors, capturing both per square meter final sales price and the breakdown of construction costs. These encompass land development costs, building expenses, investor profit, and other associated fees.

The average per square meter price for new apartments in Podgorica is 2,108 euros, which consists of 264 euros for land development, 1,674 euros for construction, and 170 euros for additional costs.

In contrast, in Nikšić, where construction activity is significant, the average price of 1,068 euros breaks down to 121 euros for land development, 856 euros for construction, and 91 euros for other fees.

This data suggests that construction costs without land and utility expenses are approximately double in Podgorica compared to Nikšić.

Foreigners Sold 59 Million Euros in Real Estate and Disinvested Funds

During the first half of the year, foreign nationals sold real estate in Montenegro for 59 million euros and subsequently moved these funds out of the country, an action categorized as an outflow of foreign investment per balance of payments regulations.

Leading the sales were Serbian citizens, accounting for 18.4 million euros, followed by Croatians with 6.1 million euros, Russians with 5.7 million euros, and Swiss citizens with 5.5 million euros, among others.

Across the entire year of 2024, foreigners sold real estate worth 121 million euros, with significant sales from Serbian investors totaling 38.4 million euros, followed by Russians at 15.1 million euros.

In prior years, foreign sales totaled 134 million euros in 2023, 109 million euros in 2022, 72 million euros in 2021, 41 million euros in 2020 during the pandemic, and 62 million euros in 2019.

Montenegrins Spent 28 Million Euros on Real Estate Abroad

As per balance of payments reports, there is also an outflow of foreign investment when Montenegrin citizens or companies purchase real estate outside of Montenegro.

In the first half of this year, domestic citizens spent 28.8 million euros on overseas property.

The most real estate purchases occurred in Serbia (13.6 million euros), with Italy (2.4 million euros) and Georgia (2 million euros) following suit.

Montenegrin purchasers also ventured into Bosnia and Herzegovina (1.8 million euros), the United Kingdom (1.7 million euros), Slovenia and Cyprus (1.2 million euros each), Germany (977 thousand euros), Croatia (937 thousand euros), Portugal (663 thousand euros), Greece (404 thousand euros), Spain (294 thousand euros), and Russia (292 thousand euros).

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