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Purchase Process in Montenegro

Below is the standard purchase process in Montenegro and issues that may affect that purchase:

• The buying process for British citizens is the same as for Montenegrins, with no restrictions on buying private property (though buying land requires the setting up of a company in Montenegro).
• The Law on Foreign Investments of Montenegro (the Law) defines Corporative Investing as a right of a foreign legal entity or natural person to establish various types of companies (General Partnership, Limited Partnership, Limited Liability Company or a Joint Stock Company) in Montenegro. The foreign investor may, either alone or together with other foreign or domestic investors, form an enterprise or purchase shares of or interests in an existing enterprise.
• After agreeing a purchase price with the seller a 19% deposit is usually standard.
• A contract is then drawn up and signed by both parties. A purchase tax of around 2% of the property value is paid. Factor in the cost of an interpreter and document translation, and be aware that lawyers can act for both parties though this can be arranged differently if you prefer. The whole process can take up to two months.
• Mortgages are beginning to become available in Montenegro from 50% to 70% loan-to-value.
• Registering a property can be completed within a couple of days at the Land Registry office, in a fairly straightforward process with little potential trouble.

Costs of a standard property purchase in Montenegro include the following:

• Legal fees amount to around 1% of property purchases
• No Inheritance Tax
• Property purchase tax is 2%
• Capital gains realised by selling securities held in the taxpayer portfolio for more than two years shall not be subject to the tax.
• The Real Estate tax rate is proportional and it is in range from 0.08% to 0.8% of the real estate market value.

The Obelisk Advantage:

As Obelisk approaches its projects purely from an investment perspective, its priority is to deliver each real estate product with an emphasis on simplicity and transparency throughout the purchase process. Therefore, Obelisk has already identified the purchase procedure for its clients as a simple, four step process:

1. The client chooses and reserves the unit that best suits their investment requirements, and Obelisk takes the client through a compliance procedure.
2. An independent lawyer, sourced and appointed for the client by Obelisk, will have already carried out full due diligence on the real estate product. They will issue all purchase contracts and paperwork to the client.
3. On receipt of this contract, the client will sign and make the first payment. The lawyer will notify the client of all further payments when required.
4. The appointed lawyer will also represent the client in all aspects legally required within the country of purchase, ensuring that clients of Obelisk enjoy the benefits of simple and hassle-free real estate investment.