Authored by the expert who managed and guided the team behind the Montenegro Property Pack
Everything you need to know before buying real estate is included in our Montenegro Property Pack
Where are the best places to invest in Montenegro right now? Is Kotor still the top pick, or are cities like Budva, Tivat, and Herceg Novi gaining ground? What makes these locations attractive to both local and foreign investors?
We’re often asked these questions because we work directly with notaries, real estate agents, and clients who invest across the country. Our firsthand experience in these markets gives us unique insights into where the real opportunities lie. To save everyone from asking privately, we’ve written this article to share our knowledge broadly.
Our goal is to highlight the hottest markets in Montenegro and explain why they’re worth your attention in 2025.
If you have suggestions or want us to dive deeper into a specific area, let us know. You shoot an email, we answer within 24 hours.
1) Kotor's Dobrota area is gaining interest for its scenic views and rising demand for holiday homes
The Dobrota area in Kotor is becoming a hot spot for holiday homes, thanks to its stunning scenic views.
In recent years, Montenegro's real estate market, including Dobrota, has been on the rise. From 2024 to 2029, it's expected to grow by 5.67%, driven by the demand for properties that blend natural beauty with modern comforts. This growth shows how attractive the area is to both local and international buyers.
Tourism in Kotor is booming, with 872,000 visitors flocking there in just June and July of 2024. This surge in tourists has led to a higher demand for vacation homes and rentals, especially in picturesque spots like Dobrota. Real estate agents often talk up Kotor Bay's premium appeal, highlighting its breathtaking scenery and the rising interest in luxury properties.
Luxury real estate projects in the Kotor area are adding to its charm. Developments like Porto Montenegro and Lustica Bay offer world-class amenities and stunning views, drawing more investors and holiday homeowners to Dobrota. The growing number of international buyers eyeing Dobrota shows its increasing allure as a prime spot for holiday homes and investment properties.
Sources: Statista, Kolpakoff, Montenegro Business
In this video, we can see that Dobrota in Kotor is confirmed as a prime location for waterfront properties and holiday homes, making it a dream expat destination.
2) Zabljak is drawing attention for its mountain tourism and ski resort properties
Žabljak is becoming a hotspot for investors, especially in mountain tourism and ski resort properties.
Tourist numbers have jumped, with a 15% increase in visitors during May and June compared to last year, and a 10% rise in July and August. This surge shows that more people are discovering Žabljak's charm, and the high number of overnight stays highlights the strong demand for what the town offers.
Big money is flowing into ski resort infrastructure, with €3 million from the capital budget and €5 million from the state. These funds are part of a larger plan to make Žabljak even more appealing, including better water supply, modern roads, and a new parking garage. These upgrades are key to handling more visitors and making their stay enjoyable.
The real estate scene in Žabljak is buzzing, with property prices on the rise thanks to ongoing investments and interest from foreign buyers. Residential properties are priced between €1,200 and €2,000 per square meter, while luxury spots can hit €3,000 per square meter in top areas. This trend is pulling in investors eyeing vacation homes or rental properties, with rental yields looking attractive at 6% to 10%.
Sources: Montenegro Business, Hillside Lux
This video showcases Zabljak's potential for mountain tourism and ski resort properties, highlighting its position as the highest-altitude city in the Balkans at 1456m.
3) The Lustica Peninsula is rising fast with eco-friendly projects and higher property values
The Lustica Peninsula is catching eyes for its eco-friendly developments and rising property values, thanks to the Luštica Bay project.
Covering a massive 7 million square meters, Luštica Bay is the largest development in southern Europe. Despite only 10% of the land being developed, there's already been a significant boost in property values. For instance, a studio apartment in Centrale, the town center, starts at EUR 109,000, showing strong market interest.
This EUR 1.1 billion project is all about sustainable infrastructure. Around EUR 90 million is earmarked for essentials like roads, water reservoirs, and wastewater treatment plants. This eco-conscious approach is attracting both local and international buyers who want to live sustainably.
Luštica Bay isn't just about homes; it includes a new marina village, five-star hotels, and real estate neighborhoods, all designed with sustainability in mind. The development also boasts an 18-hole golf course, schools, hospitals, and community facilities, making it a luxurious and sustainable destination.
Buyers are drawn to the idea of living in a place that offers both luxury and a commitment to the environment. The project's focus on eco-friendly living is a major selling point, especially as more people look for ways to reduce their carbon footprint.
Sources: Luštica Bay, Luštica Bay Blog, Standard.co.uk
4) Bar is gaining interest for its affordable seaside homes and rising demand from international buyers
Bar is gaining popularity for its affordable seaside properties and increasing demand from international buyers.
In 2023, foreign direct investment in Montenegro's real estate saw a 5.41% rise, with Bar playing a key role in this growth. This uptick shows a clear interest from international buyers who are eyeing Bar as a promising investment spot. The town's appeal is largely due to its affordability, with apartments starting at €50,000 and houses from €100,000. Compared to other coastal towns like Budva, where prices soar, Bar offers a more budget-friendly option.
International real estate agencies have set up shop in Bar, underscoring the growing interest from foreign buyers. These agencies focus on properties in Bar, signaling a significant demand from international clients. Local real estate agents have noticed a surge in buyers from countries like Germany and Russia, drawn by Bar's scenic beauty and competitive prices.
Bar's charm isn't just in its prices; it's also about the lifestyle. The town offers a laid-back vibe with stunning coastal views, making it a perfect spot for those looking to escape the hustle and bustle. The presence of international buyers is a testament to Bar's appeal, as more people discover its potential as a real estate hotspot.
For those considering a property investment, Bar presents a unique opportunity. The combination of affordable prices and increasing international interest makes it a compelling choice. As more people learn about Bar's offerings, the demand is likely to continue growing, making now a great time to invest.
Sources: Global Property Guide, Montenegro Real Estate, Deluxe Estate, The Wandering Investor
5) Podgorica’s City Kvart is popular for its modern apartments and high rental demand from young professionals
City Kvart in Podgorica is a magnet for young professionals thanks to its modern apartments and bustling rental market.
In this vibrant neighborhood, apartments are snapped up quickly, showing just how eager people are to live here. It's a hot spot for renters, with high occupancy rates that speak volumes about its popularity.
Over the years, property values in City Kvart have climbed, reflecting its growing appeal. Back in 2019, studio apartments were fetching prices as high as €1,750 per square meter, a testament to the area's desirability among buyers and investors.
Young professionals love City Kvart for its modern amenities and central location. It's the perfect place for living and working, which keeps rental demand high. This demographic finds everything they need right at their doorstep.
For property investors, City Kvart is a goldmine. The average gross rental yield in Podgorica, where City Kvart is located, is 5.70% for apartments. This makes it an attractive option for those seeking solid returns on their investments.
Sources: RE/MAX Montenegro, Global Property Guide
Don't buy the wrong property, in the wrong area of Montenegro
Buying real estate is a significant investment. Don't rely solely on your intuition. Gather the right information to make the best decision.
6) Herceg Novi is gaining attention for its charming old town and potential for property value growth
Herceg Novi is quickly becoming a favorite for those eyeing charming old towns and property investments.
With median apartment prices hitting €3,493/m² and houses at €2,825/m², the town is seeing a surge in demand for residential properties. This trend is catching the attention of international buyers, who are particularly drawn to Montenegro's favorable tax policies for foreign investors.
The influx of foreign interest has led to more real estate transactions, boosting property prices. Nearby luxury housing projects, like those in Kotor Old Town, are also attracting high-net-worth individuals, which is driving up the premium market segment.
Herceg Novi's charm isn't just for investors; it's also a hit with tourists. About 14.9% of tourists now choose to stay in this picturesque town. This rise in tourism is fueling the hospitality and service industries, which is expected to keep pushing property values upward.
As the town's popularity grows, so does its potential for property appreciation. The combination of a thriving tourist scene and attractive investment conditions makes Herceg Novi a compelling choice for property buyers.
Sources: Properstar, Montenegro Business
One of our partners sent us this video where Herceg Novi's appeal is showcased, featuring its 7-kilometer promenade, restaurants, cafes, and beaches. The video emphasizes the lower cost of living compared to other European countries and highlights expat lifestyle opportunities.
7) Tivat is drawing investors with luxury developments and high rental yields from the Porto Montenegro marina
Tivat is drawing in investors thanks to luxury developments and high rental yields at Porto Montenegro marina.
Porto Montenegro is not just any marina; it's a hub of luxury with projects like the SIRO hotel and the Synchro project elevating its status. These developments have attracted big names in dining and shopping, making the area even more appealing. The government has backed these luxury real estate projects, turning Porto Montenegro into a key spot for international yachting.
Properties near Porto Montenegro are in high demand, selling fast because of the top-notch amenities and conditions the complex offers. Since 2012, property values have skyrocketed, with some areas seeing prices jump by over 200%.
Investors are particularly interested in the high rental yields that come with owning property in this area. The marina's luxury appeal and amenities are major factors driving these yields.
Porto Montenegro's allure is further enhanced by the presence of renowned restaurants and retail outlets, which have set up shop thanks to the area's growing reputation. This has made it a prime location for both living and investment.
With the government's support and the influx of luxury brands, Porto Montenegro is not just a marina but a strategic destination for investors looking for high returns.
Sources: Sotheby's Realty, Opština Tivat, The Imperium
8) Sveti Stefan is prestigious for its exclusive properties and high demand for luxury real estate
Sveti Stefan is a hotspot for luxury real estate, thanks to its exclusive properties and high demand.
In this area, property prices soar above other Montenegrin regions. For instance, nearby Porto Montenegro boasts apartments that can fetch up to €14,000 per square meter, especially those offering breathtaking sea views. This makes Sveti Stefan a prime choice for those seeking opulence.
The allure of Sveti Stefan is amplified by its limited property availability. This scarcity, coupled with high demand, naturally inflates prices, enhancing the market's exclusivity. The area is dotted with luxurious private cottages and suites, some featuring private pools and terraces, which attract affluent buyers in search of unique, high-end living experiences.
Adding to its charm, Sveti Stefan hosts the renowned Aman resort, celebrated for its stunning views and top-notch amenities. This resort, along with boutique hotels like Hotel Adrovic, cements the area's status as a luxury destination. The historical significance of Sveti Stefan, dating back to the 15th century, adds a cultural depth that appeals to many high-profile individuals.
Many celebrities have chosen to vacation or even marry in Sveti Stefan, drawn by its rich history and exclusive atmosphere. This celebrity appeal further boosts the area's prestige, making it a sought-after location for luxury real estate.
For those considering a property investment, Sveti Stefan offers a unique blend of history, luxury, and exclusivity. Its limited availability and high demand ensure that properties here remain a valuable asset.
Sources: James Edition, The Hotel Guru, The Wandering Investor
We created this infographic to give you a simple idea of how much it costs to buy property in different parts of Montenegro. As you can see, it breaks down price ranges and property types for popular cities in the country. We hope this makes it easier to explore your options and understand the market.
9) Budva’s Rafailovici is thriving with beachfront homes and a strong short-term rental market
Budva's Rafailovici neighborhood is a hot spot thanks to its beachfront properties and strong short-term rental market.
In Rafailovici, property prices are on the rise, with projections showing an increase of 3% to 7% by 2025. This surge is fueled by growing tourism and a limited supply of real estate, making it a desirable location for both buyers and renters. The scenic beauty of the area adds to its allure, drawing more people to invest in this charming coastal spot.
The real estate market in Budva, including Rafailovici, is thriving. Investors are seeing stable or increasing rental yields and capitalization rates, which means that even with rising property prices, demand remains strong. This makes Rafailovici an attractive investment opportunity, especially with short-term rentals boasting occupancy rates of up to 95% during peak seasons.
Tourists love Rafailovici, as shown by the positive reviews and high ratings on vacation rental platforms. They're willing to pay more for the privilege of staying in beachfront properties. The area is undergoing gentrification, with new transport links and redevelopment projects, which are likely to push property prices even higher and make it even more appealing to both residents and investors.
Sources: The Wandering Investor, The Wandering Investor, Trading Economics
10) Petrovac is gaining popularity for its serene coastal charm and promising property value growth
Petrovac is quickly becoming a favorite for those seeking a peaceful coastal retreat with promising property value growth.
Imagine owning a slice of paradise where property prices are on the rise. While exact figures for Petrovac might be scarce, the trend in Montenegro's coastal areas is clear. For instance, the average price per square meter for apartments in Petrovac is about €2,462. This is notably lower than in bustling towns like Budva and Kotor, hinting at potential for future growth.
Foreign investors are catching on to this opportunity. In 2023, foreign direct investment in real estate increased by 5.41%, reaching €296.81 million. This surge in investment is a strong indicator that Petrovac and similar areas are becoming hot spots, likely driving up property values and enhancing their allure.
Petrovac's charm isn't just in numbers; it's in the experience. Travel articles and reviews often rave about its tranquility, drawing in tourists and potential buyers alike. This buzz contributes to its growing popularity, making it a place where people want to invest and live.
Compared to more developed areas like Budva or Kotor, Petrovac offers a more affordable entry point into the coastal property market. This affordability, combined with its serene environment, makes it an attractive option for those looking to invest wisely.
Sources: Properstar, Global Property Guide, Montenegro Prospects
11) Bijela is gaining attention for its closeness to the Bay of Kotor and rising demand for waterfront properties
Bijela is becoming a hotspot because of its close proximity to the Bay of Kotor, a stunning area known for its natural beauty and UNESCO heritage sites.
Investors are drawn to Bijela for its exclusive waterfront properties, making it a prime location for real estate. The area is buzzing with new developments, like Luštica Bay, which has already delivered nearly 600 residences and attracted people from over 40 different countries.
Foreign investors are showing a growing interest in Montenegrin real estate, especially in coastal areas like Bijela. The demand for homes in the Bay of Kotor region is fueled by both locals and international buyers who are on the hunt for luxury apartments and waterfront properties.
Bijela's appeal is not just about the properties; it's about the lifestyle. The area offers a unique blend of natural beauty and modern amenities, making it a desirable place to live or invest. The international community in Bijela is thriving, adding to the area's charm and vibrancy.
With its strategic location and increasing interest from global investors, Bijela is poised to become a key player in the Montenegrin real estate market. The ongoing developments and the influx of international residents are clear indicators of its rising popularity.
Sources: Lustica Bay Blog, The Wandering Investor, Montenegro Real Estate
Make a profitable investment in Montenegro
Better information leads to better decisions. Save time and money. Download our guide.
12) Ulcinj is gaining interest for its long sandy beaches and rising demand for vacation rentals
Ulcinj is catching eyes for its long sandy beaches and booming vacation rental scene.
In recent years, Ulcinj has seen a surge in vacation rental listings, especially on platforms like Airbnb. This uptick in listings reflects a growing demand for vacation rentals, making Ulcinj a hot spot for tourists. The town's appeal is largely due to its stunning beaches, which are a major draw for visitors.
Velika Plaža, a 13-kilometer stretch of sand, is a standout attraction. This beach is not just a natural wonder but also a magnet for summer tourists. The influx of visitors has fueled the vacation rental market, as more people want to soak in the beauty of Ulcinj's coastline.
Ulcinj's real estate market is also on the rise, offering everything from luxury seaside homes to budget-friendly city apartments. This growth is bolstered by the town's expanding tourism infrastructure, making it appealing to both vacationers and investors. The combination of breathtaking beaches and a thriving real estate market makes Ulcinj a sought-after destination.
For those considering a property purchase, Ulcinj offers a unique blend of natural beauty and investment potential. The town's development is supported by its robust vacation rental market, which continues to attract attention from around the globe.
With its picturesque landscapes and growing amenities, Ulcinj is becoming a prime location for both leisure and investment. The town's allure is undeniable, drawing in those who wish to experience its charm firsthand.
Sources: Airbnb, Home in Montenegro, Sandaltanman
From this video, we realize that Ulcinj's long sandy beaches and potential for holiday investments make it an attractive destination for tourism and vacation rentals.
While this article provides thoughtful analysis and insights based on credible and carefully selected sources, it is not, and should never be considered, financial advice. We put significant effort into researching, aggregating, and analyzing data to present you with an informed perspective. However, every analysis reflects subjective choices, such as the selection of sources and methodologies, and no single piece can encompass the full complexity of the market. Always conduct your own research, seek professional advice, and make decisions based on your own judgment. Any financial risks or losses remain your responsibility. Finally, please note that we are not affiliated to any of the sources provided. Our analysis remains then 100% impartial.