I spend a few months every year in Montenegro and have been active in real estate there since 2017. It’s been a good ride.

Most people just buy apartments or villas, but another way of approaching this market is to buy land and build.

In this video with my favourite Montenegro realtor Peter Square Meter we went to check out two potential projects and ran all the numbers. Since these case studies have been published, constructions costs and taxes have gone up a bit, so the net numbers would be a bit lower now.

But overall these case studies give a good overview of buying land and building in Montenegro, one of Europe’s most beautiful countries.

Overview of the Montenegro real estate market

Here is a full analysis of the Montenegro real estate market.

If you want to get in touch with Peter Square Meter feel free to shoot him an email. Add your Whatsapp number if you use it.

I won’t fail to spend most of the Summer in Montenegro.

For those who are interested, getting residency in Montenegro is easy.

To a World of Opportunities,

The Wandering Investor.

Other articles on Montenegro:

Available services in Montenegro:

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Transcript of “Buying land lots / plots in Montenegro – an analysis”

LADISLAS MAURICE: Hello, everyone. Ladislas Maurice from thewanderinginvestor.com. Today, we are in Luštica in beautiful Montenegro with Peter Square Meter. And we’re going to go check out a project where if you do things well, you can make 50% to 60% gross within 18 to 24 months. Essentially, it’s about buying a lot of land here with nice sea views, building contemporary villas, and then flipping them. Peter, how are you?

PETER: I’m good. Nice to see you again.

LADISLAS MAURICE: Yes, yes, always a pleasure.

PETER: Just, I’m really sorry. I’m on holiday. We’re actually staying at this beautiful villa here.

LADISLAS MAURICE: It’s nice. It’s nice. We actually we did a video last year of this unfinished villa, which was also a flip opportunity for where people could make about 50%.

PETER: Yeah.

LADISLAS MAURICE: That one would have been quicker, really, 18 months?

PETER: Yeah.

LADISLAS MAURICE: And you sold it, right?

PETER: Sale’s going through right now.

LADISLAS MAURICE: Cool. And people are going to go ahead with that project?

PETER: Yes. Yeah, they are. Yeah.


PETER: And we’re staying here in this lovely villa, so it’s absolutely awesome. I’m a big fan of Luštica.

LADISLAS MAURICE: Cool. All right, fantastic. What we’re going to do is because people typically when they think of Montenegro, people think of Budva, Tivat, Kotor, Herceg Novi. Not too many people have heard of Luštica, but the area is growing fast, probably faster than any other area here in Montenegro.

PETER: Yeah. It’s coming up really strongly since Orascom put in Luštica Bay. You’ve got a, I don’t know, $1.5 billion-dollar kind of development going on there, selling really, really well. It’s actually only about 20 minutes from here, so it’s pretty useful. Eventually, we’re going to have a Gary Player golf course championship golf course going on there.

LADISLAS MAURICE: That’s a big catalyst.

PETER: All the kind of usual. We’ve got Chedi Hotels there. I think they’ve got two hotels there at the moment, they will have maybe six or eight in total eventually. And also, we’re very handy for Jaz Beach, Miriste Beach, fantastic restaurants down there.

LADISLAS MAURICE: Cool. You’re going to take us to one of the beaches right now. We’re going to have kind of a look to have a better understanding of what the lifestyle is here. Then we’re going to head out to the lot. And we’re going to do all of the numbers in terms of the price of the lot, the construction prices per square foot, per square meter, how much we can flip them for, etc., so that people have a good idea of what the project is. And then afterwards, we’re going to drive all the way to Herceg Novi. And we are going to go check out a plot of land that is essentially riverside?

PETER: It’s on the mouth of the river, basically, I don’t know in meters, maybe 30 meters from the actual sea. You just come in, it’s really good because you can actually come in with a boat. For example, if somebody has a yacht, they can put it in the local marina and they can bring the tender to the property, the plot goes through the water’s edge.

LADISLAS MAURICE: Cool. And there it’s a different project, we build the building there.

PETER: You can build a fantastic villa. I think there’s good opportunity if somebody wants to make some money, then it could be six two-bedroom apartments, nice luxury waterside apartments with water access, of course.

LADISLAS MAURICE: Cool. We’ll do the numbers for that as well. All right, fantastic. Now let’s head out to the beach and have a look at the whole what it looks like.

PETER: Yeah.



LADISLAS MAURICE: How long have you been living here, again?

PETER: This is my 18th year.

LADISLAS MAURICE: Why are you still rolling with British plates?

PETER: Don’t put that in the video. [laughs] Because this is a British classic, that’s why. I managed to pick this up last year. And I love this car. It’s nearly a 30-year-old Toyota 4Runner. Actually, it’s a Toyota Surf.

LADISLAS MAURICE: All right. [laughs]

PETER: Japanese import.

Life and development in Lustica, Montenegro

LADISLAS MAURICE: Peter, are you enjoying driving on these roads?

PETER: Yeah, I love it. Yeah, this is one of my favorite areas. This part of Luštica is actually you can see the kind of olive groves around and cypress pine trees. And it’s more like Tuscany here. Yeah, it’s a bit special.

LADISLAS MAURICE: It is. It’s really beautiful.

PETER: Yeah. I’m trying to avoid the guy in the Mazda now.


PETER: Yeah.

LADISLAS MAURICE: And what about, because it’s a bit remote. It took me 30 minutes to drive from this place, where you’re staying at, to the center of Tivat, where I’m staying. For a lot of people, 30 minutes, this feels like a lot. Do you feel that it’s a hindrance for people who want to stay here or is that what they’re looking for?

PETER: For the people who want to be in a town, they’ll be looking to the towns and, obviously, some people like to be, me, personally, I like to be kind of in a location like this, especially if they have busy lives so you have somewhere which is very tranquil, so you’re really out in the unspoiled nature here. It’s lots of beautiful little stone houses, churches and things surrounded by these kind of Cypress pines and olive groves around the place. Some great beaches here as well. I think some people like to come back to their house, and relax, and just listen to some music or the cicadas or whatever it may be.

LADISLAS MAURICE: Yeah. It’s very nice. Like, these cute little churches here, little cemetery, people are building these nice villas around. It’s very peaceful yet somehow premium as well, and there’s history, but it’s a bit rundown, which is charming as well. There’s a lot to like about this area.

PETER: I can tell you about the clients that we have that buy here. And it tends to be, let’s say, a little bit more high end, so people who want to have their remote villa and they want to have something a little bit more exclusive, more private, and so on. And then if they want, they can say just get down to the beach or they can be in Porto Montenegro in 35 minutes or something, or they can be in Luštica Bay in less than 20 minutes, having lunch at the Chedi or so on. It has this high-end villa appeal to it. Certainly, the stone houses are pretty much all sold now. Now the market is the new villas, either in the classical style or the contemporary style.

LADISLAS MAURICE: Cool. See, look at these beautiful mountains behind. That’s actually the mountains, they’re on the other side of the bay. All over Luštica you have all these beautiful little villages that dot the hills. It’s quite special here. And then, like I said, 30 minutes away you’ve got Tivat Airport.

PETER: Yeah, Tivat Airport and…

LADISLAS MAURICE: And two hours away you’ve got skiing.

PETER: Exactly.

LADISLAS MAURICE: And all these marinas as well for if you have a boat or yacht, whatever. All right. Here we are. This is apparently one of Peter Square Meter’s favorite restaurants. Nice. Peter, this is your hangout spot?

PETER: Yeah. Actually, this is my favorite restaurant in whole of Montenegro.


PETER: It’s a really nice family restaurant. They do excellent fish here. It’s kind of really cool. We’ve got a little tiny beach here. Down here, let’s go this way, maybe. I can show you the little space down here. You’ve got the sun lounges.

LADISLAS MAURICE: Cool. And [laughs] Peter has forced me to add a link to the restaurant here, because he didn’t want to pay for parking, so he went to the restaurant manager and said that I’ll add a link if we don’t pay for parking.

PETER: Yeah. It’s a great recommendation, don’t worry about it.


PETER: I don’t know if you can see over there, you have island over there is Mamula. That’s now luxury resorts run by Luštica Bay.


PETER: The island over there in the middle.


PETER: With the round building.

LADISLAS MAURICE: You want me try to zoom in here? Okay. This is actually running right now?

PETER: It’s a five-star resort run by Luštica Bay.


PETER: Behind it, you have this isthmus with another fort that’s called Prevlaka. That’s actually Croatia.

LADISLAS MAURICE: Yeah, yeah. Where the kind of castle/resort is?

PETER: Yeah.

LADISLAS MAURICE: That’s a little island, that’s Montenegro. And behind that’s Croatia.

PETER: And also on this side here, you have another fort which is Arza. We have a big development plot there for sale as well, which is like big, big [crosstalk 08:51].

LADISLAS MAURICE: Essentially, the island is for sale?

PETER: No, no. The island is run by Orascom Luštica Bay but we have this the fort, okay, that we protected, but the land around the fort we have that for sale as a development.

LADISLAS MAURICE: Okay, cool. Cool. Yeah, this is nice here. This is very relaxed. I’m very relaxed. Cool. And this is, essentially, just a five-minute drive to the land plot.

PETER: From the plot, yeah. Exactly.

LADISLAS MAURICE: Yeah, just like straight up the hill, really.

PETER: Yeah. And it’s a great place.

LADISLAS MAURICE: Gosh. And this is, what, a hotel?

PETER: No, that’s somebody’s house. They made a villa there.


PETER: I think that’s available for about €8 million.

LADISLAS MAURICE: Cool. Okay. It’s being sold as well?

PETER: Yeah.

LADISLAS MAURICE: Okay. Cool. Yeah, Peter knows all the listings on Luštica.

PETER: Let me take you to Jaz now.


PETER: Let’s go over there.


PETER: It’s a different beach.

LADISLAS MAURICE: So yeah, like, cute little hotels. There’s a nice restaurant down there. Very nice restaurant. Just look at how gorgeous it is here.

PETER: This is pretty awesome here. You have this lovely [laughs] falling over the path, lovely pine trees. You’ve got Jaz Beach just in front of you here. I’ll walk backwards. Beautiful Aqua marine waters.

LADISLAS MAURICE: And you can just swim here everywhere. I actually go spear fishing around here.

PETER: Yeah. Tell you what’s an interesting point–

LADISLAS MAURICE: Once a week. I come here once a week. That’s about a 35-minute away drive from Tivat. I park the car right there, where we parked, but I pay for parking. [laughs]

PETER: Yeah, I don’t pay for parking.


PETER: I’m a local. One interesting thing about the water around here is that you actually have a lot of sea urchins. Now, sea urchins are a great indicator because they can only live in very clean water, so it’s great to see sea urchins.

LADISLAS MAURICE: Yeah. You see how transparent it is. And then the beach, let’s see if we can get an angle. There are all these restaurants. You do have to buy these kind of shoes because it’s pebbles. But yeah, lovely beach right here. It’s big, very big. The beer is good as well. Beer on tap, €3.50 for a pint. And then that little villa is right here behind. It’s lovely here.

PETER: Just a heads up, I’m not sure we can get me in there, but I think they’re now planning on building a four or five-star hotel here.


PETER: And looking at maybe upgrading some of these, what seems to be more like temporary structure buildings but they’ve been there for decades. And they’ll be doing kind of a newer, cooler kind of bars to kind of go along here. But it’s great, draft beer, some great kind of squid and a salad or whatever, it’s a really cool place to be.

LADISLAS MAURICE: Cool. Essentially, I hear this, I’m a little sad, because I like it the way it is, a little rustic. 

PETER: Me too. Me too.

LADISLAS MAURICE: But for the investor, I mean, if there’s going to be a four-star hotel, they’re going to be upgrading this whole thing, making it more premium, I mean, for the villas, it’s good for the project right up there. Let’s go to the lot. Let’s have a look at the land and do the numbers.

PETER: Sounds like a deal.

LADISLAS MAURICE: But one of the drawbacks of buying here is infrastructure, right?

PETER: Yeah. But it is improving. They’re about to build a road through the middle of Luštica, a little bit higher up. That road will not only be quicker and easier and straighter, it will also have awesome views. Instead of actually going, there’s this kind of one road that goes round like a perimeter of Luštica pretty much, the peninsula, but you don’t really see much there because you’re kind of a bit low down with the houses and the walls and so on, whereas the new road will be higher up and you’ll have awesome views of probably some parts in the Tivat bayside, but definitely of the Adriatic Sea.

LADISLAS MAURICE: And what about government services here like electricity, water, garbage, waste disposal?

PETER: Garbage is very common. Even where we live, you just have the large containers, so you just take your rubbish to those and you pay–

LADISLAS MAURICE: So no recycling, you just throw pretty much everything in these? Actually, there’s one we’re going past to here.

PETER: Yeah. Recycling is quite new, so at the moment, it’s kind of limited, so plastic bottles and so on.

LADISLAS MAURICE: Just these things, you just take whatever you have and you throw it.

PETER: Yeah, and you bring your rubbish to there. And these things are dotted, so they’re very in handy places all throughout where the people live.

LADISLAS MAURICE: What about water, because water is an issue?

PETER: Water, at the moment, people do the rain water harvesting. And then, normally, when the rain falls on the roof, and it then goes into a water tank, but water’s coming. I think in the next two to three years, pretty much most of Luštica will be hooked up with city water, they would call it. It’s actually it’s in progress.

Plot / lot of land for sale and ROI numbers in Lustica, Montenegro

LADISLAS MAURICE: Government water is coming. In the meantime, people have to make provisions.

PETER: Yeah.


PETER: Electricity, the investor of the plot that is selling it actually invested a big sum of money to bring electricity to the plot, so it has its own little mini kind of substation on the plot. You have it already in place.

LADISLAS MAURICE: Okay, cool. So access to electricity. Peter Square Meter, tell us about the land here.

PETER: Fantastic plot. I like it so much I bought one myself, a good one, behind my shoulder here.


PETER: Yeah. 3,000 square meters just over there. For sale for a reasonable price, if you like. This is 3,800 square meters. It’s got two urban parcels. Currently, I’ll tell you the current status and I’ll tell you what I’ve been told, that’s information coming in from the Planning Department. Currently, down there you can see the concrete foundations. You’ve got two times 157 square meters. And in this area where the camera is now it’s planned a bigger building of 370 square meters, that the current owners did plan maybe to put five apartments there, or it could be one great big villa there. That’s that. And in addition to that, I’m told that you can actually do another 200 square meter house on two levels plus an auxiliary building of 200 square meters on one level, which could be quite cool, actually.

The alternative is to divide the whole plot into five parcels of about 700 square meters, then I’m told you could actually do five villas of a gross build area of 250 square meters, which is ideal villa size. You’re talking in terms of what you can do there, probably four bedrooms, four bathrooms for a rental property. Fantastic, because you sleep 10 or 12 there quite easily. You’d have, like, two in each bedroom, and then maybe two or four in the living room.

LADISLAS MAURICE: I thought, for a while, you had an alternative lifestyle. [laughs]

PETER: I do have an alternative lifestyle. Also we manage some properties as well. Remember, at the beginning of the video, we were staying at a villa, and it’s just over there. Yeah. You can actually do villa rentals. And for this location, nice villa, I would say, in today’s money, you should be getting about €400 per night.

LADISLAS MAURICE: Cool. I think here, let’s not go into the whole rental returns. Because, again, that would be peak season, etc. That’s a whole other ballgame in terms of rentals. But in terms of capital gains, I think this is where it’s interesting. Let’s take these five villas of 250 square meters each. That’s approximately 2,700 square feet per villa. What are the construction costs right now for a nice villa?

PETER: Yeah. I’d say for this location, you pay a little bit more to be in the location because you’re a little bit further away from town, but not too far away, maybe 30 minutes more, 20, 30 minutes more journey for the builders to bring their materials here or something, so not ridiculous. And especially if you’re building five at a time. I’d say that you’d do, I would categorize it as a luxury villa. You could then go from there and be a deluxe. This would be lux category. Probably around about €1,000 to €1,100 per square meter, that’s going to get you what you need. That would actually include, overall, if you times that by 250, that would actually get you a modest pool as well, something like 4 meters by 8. That would give you an appropriate size pool. And that’s it. You can go lower or you can go higher, but I think that’d be appropriate for this kind of location, and give you the biggest bang for your buck.

LADISLAS MAURICE: Let’s go with the higher number to be safe, so €1,100 a square meter times 250, €275,000, because it’s five land plots. How much is this whole thing going for?

PETER: This is €295,000.

LADISLAS MAURICE: Okay, so each plot of each fifth would be a bit less than €60,000. Essentially, you’re looking at roughly €335,000 to have a plot of a bit over 700 square meters with a villa, four bedrooms, four bathrooms, swimming pool 250 square meters. Cool. That’s the idea. How much would you sell them for?

PETER: That kind of villa would be, I’d say, easy money about €500,000. Bad day, you’re thinking worst case scenario, €450,000. And then if the market’s really good, then probably topping out at maybe €600,000 in kind of today’s market, depending on the design, the finish, and so on.

LADISLAS MAURICE: Yeah, €450,000, honestly, would be too cheap, and I’m conservative. I think €500,000 to €550,000, I would go with these numbers. You would be looking at essentially €500,000 divided by €335,000, or €550,000 divided by €335,000, and that’s your gain. Gross, you’re looking at a gain of between roughly 50% and 64%. Net, once you take this gentleman’s agency fees, which are, to be fair, relatively high in Montenegro, you’d be looking at between 41% and 55%, essentially, net before capital gains taxes, which are quite modest in Montenegro, which not a lot of people pay. This is not tax advice. Obviously, you should pay your capital gains taxes, but they’re 15%.

And how long would this project take? If I come to you and I say, “Peter, I want to buy this thing. I have the money now.” How long to be able to actually start building, to get the permits? Then how long for the building? And how long do you think it would take to sell them, if we still have the market in the current conditions, which means it’s pretty hot?

PETER: Yeah. You’re looking the realistic timeframe to get the money, go and speak to an architect, go through the planning process. And it’s all prescriptive, so it’s not such a difficult thing to do. You’re probably talking about a couple of months’ time, two to three months’ time to go through the architect and the planning process. And then the building process, something like this should be 12 months. And so I would say, to give you a big buffer, if you look at a timescale of between 18 months and 24 months from start to finish, to give you a key-in-hand finished product, then that’s you’re looking at. I’d say that if somebody comes to me, I don’t know, in the next few months, then they could be looking at being ready for the spring, summer, or certainly summer 2025 season if they wanted to sell it or if they wanted to rent it.

LADISLAS MAURICE: Cool. Okay. Essentially, look, you build these five villas, you sell three of them, you end up with one for yourself for free, and the other one for really cheap. Essentially, that’s pretty much the deal, or you sell all of them and you make your flip, take your money and run. 

Why invest in Montenegro?

LADISLAS MAURICE: What do you feel are some of the risks here? Because it’s important to highlight risks.

PETER: I think the risks are global downturn in economy. But having said that, Montenegro is an exception, not a rule. What I’ve seen here, I’ve been here close to two decades now. The momentum of the people wanting to come to Montenegro is quite high. I would also say that when you do have a downturn, things just kind of go on pause. And then when the market picks up again, then they kind of carry on where they left off. It would be it would just take longer to sell, if that was your reason for investing. But I still think, and I know Ladislas wants to concentrate on the sale side and the profit side, but I think this also makes a great case for somebody who wants to have their own little, almost like a pension plan or something like that, so they can build and rent out and they’ve got a great income. It’s a good business scenario with this. And then, obviously, you’ve got an asset which is going to grow.

LADISLAS MAURICE: Yeah. I agree with these points. I would add that because Montenegro is mostly a cash market, the reality is when interest rates go up, or when the markets crash in Western countries, the market in Montenegro isn’t too impacted, certainly a lot less than it is in the UK, France, the US, Canada, etc. Because it’s people who buy real estate in Montenegro, it’s typically their third, fourth, fifth property overseas, etc. They don’t need that money. They like having it here. And they don’t typically try to sell. To Peter’s point, when there’s a downturn, it takes really a while for prices to correct, if they correct at all. In many ways, there’s less downside here in Montenegro than in Western Europe, or North America, or Australia in the current situation.

A risk I would highlight is more issues in Europe in terms of war, etc. But again, what we’re seeing is that Montenegro is actually benefiting from wars. Tons of Russians and Ukrainians have moved here. The population has grown 10% in terms of fulltime population here in the last 18 months, which has been a massive shot in the arm for the Montenegrin economy, because it’s reduced seasonality overall, even in winter, in spring, in autumn, you have people living here all year round, helping the economy, paying VAT, paying taxes, etc. That’s been really positive. And we also see a lot of Western Europeans that are moving down to Montenegro on a permanent basis because they’re sick and tired of politics back home, etc., and they want to be in a country where they feel a bit more free and where the cost of living is lower as well.

I’d say it’s a risk, issues in Europe, and in many ways, it ends up being a positive for Montenegro counterintuitively. This being said, the Euro is being used here in Montenegro, so Montenegro is not immune to potential issues with the euro. If you’re of the view that the euro is going to be having a hard time, then you have to build that into your model. And finally, I would say that if, again, related to Europe, if the economy takes a turn for the worse, we’ll definitely see a downturn in tourism from people coming down from Europe. Because hey, when money’s tight, you spend less on holidays and vacations. But, again, because seasonality is being reduced in Montenegro, what Montenegro seems to be losing or would lose in peak season tourism, it would gain in low season people moving here fulltime.

And as well, a lot more Canadians and Americans are coming here to Montenegro, because they’re always restricted in terms of Schengen with 90 days, 90 days. When they want to recharge their Schengen days, they don’t have that many options. They can go to the UK, but that’s pretty expensive. They either go to Turkey, they go to Serbia, Albania, Montenegro, Macedonia. Increasingly, you have Americans coming here in the low season, digital nomads, people working remotely coming for two, three months, booking apartments in low season just to recharge their days, it’s a pleasant place to do so, and then they go back to Italy, to Spain, to France, to all of that. There’s a lot going for Montenegro from that point of view.

PETER: Let me just add something to that as well. I think it’s quite interesting how a lot of the big names in the hotel industry have already come to Montenegro. And as first in Europe, I’ve mentioned this before, so Aman Resort, Chedi Hotels, One&Only Hotels, Regent Hotels. Hyatt Regency has just opened up. And I think that a lot of the downturn that we’re seeing now is, let’s say–

LADISLAS MAURICE: So you are seeing downturn in tourism here, right?

PETER: In the world. No, no, I’m talking about downtown in the world. This year is a little bit quieter in tourism. But I think that anybody with some kind of foresight in real estate tends to be medium long-term planning anyway. The likes of these big hotels, or anybody wanting to do some development, by the time they do anything, by the time they finish, we’re talking about 18, 24 months hence, and chances are we’re at the start of a new rise in the market, and so on. Those who are buying now are very well set up for the next boom cycle.

LADISLAS MAURICE: It’s interesting, because I do feel that there is a bit less tourism in Montenegro this year. But upper end tourism is absolutely booming. All the four-star, five-star hotels are fully, fully booked. We’re really seeing a divergence from that point of view. Cool. Peter, now let’s drive to Herceg Novi, right? 

PETER: Yeah, let’s go.

LADISLAS MAURICE: Herceg Novi is quite far, actually, it’s going to be quite the ride.

PETER: It’s over there.

LADISLAS MAURICE: Yeah, like, beyond. Between the hill here and the mountains behind, there’s the whole bay, so we’re going to have to take the boat, etc. We’re going to go check out that riverside, near-sea-front plot for that whole building with river access where you can have your own boat. And we’re going to do the numbers there as well. All right, cool. Let’s go.

PETER: Let’s go.

Plot / lot of land for sale and ROI numbers in Herceg Novi, Montenegro

LADISLAS MAURICE: All right, fantastic. Peter Square Meter, tell us about this plot.

PETER: Great. Well, we’re here in a place called Sutorina. Sutorina is named after the river, actually. It’s the River Sutorina, we’re right at the mouth of the river going into Herceg Novi Bay. It’s a nice sized plot, is 620 square meters.

LADISLAS MAURICE: It’s this house, essentially, the–

PETER: It’s got an existing building on but essentially you just knock that down and then just redevelop it. Unless you wanted to do something very cheap then you can redevelop that and make it a little house. Yeah.

LADISLAS MAURICE: Cool. It’s really nice, Peter. This is the little river. How much is this plot going for?

PETER: €300,000, at the moment, but the price may go up. [laughs] Just, at the moment, it’s €300,000 but prices are going up in the area. The next jump, if it does go up, probably will go to €350,000.


PETER: Currently, we’re talking €300,000.

LADISLAS MAURICE: So €480 per square meter, 620 square meters, roughly, almost 7,000 square feet, roughly, for the plot.

PETER: Yeah, that’s the plot.

LADISLAS MAURICE: When I see this, I mean, it’s beautiful. You have the whole bay here. We’re going to go up on the structure to see, but this is really, really special. I’d be worried about flooding here. What’s your take?

PETER: Very simple. Like, you can see on both sides, the neighbors have built up their plots. We spoke to the neighbors and they said that there’s no issues with flooding, but they have actually kind of build it up because also it’s a bit handy, if you can see, for the boat there, it’s handy for the boats as well. If you want to pull a boat alongside then you can just step into the boat quite easily, so just have a higher key side here. And also, when we’re up on the roof, we’ll be able to see the neighbor’s pool. And that’s kind of built up. It’s cheaper to build up than it is to build down. And obviously, I wouldn’t recommend building down here anyway. And then you can have maybe like an infinity pool or something like that, and then just kind of hang over the edge of the pool and then you’ve got these fantastic views.

LADISLAS MAURICE: Cool, fantastic. Let’s go up there. And we’re going to do all the numbers in detail in terms of scenarios and how much we can make as investors if we buy this plot of land, essentially, buy a building and flip the units. Peter, before we go into the numbers, can you tell us a little bit about Herceg Novi because when people think Montenegro, they think Kotor Bay, Luštica, Budva, but–

PETER: Porto Montenegro.

LADISLAS MAURICE: All of that, but not really Herceg Novi.

PETER: Yeah. Herceg Novi, beautiful town, actually. The town is just over there, sitting in the distance is one of these old fortified Austro Hungarian towns. A lot of people who move here prefer it to living in the Bay. Because if you notice, you don’t have any high mountains around you here. It’s a lot more open, so you get a lot more sunshine. That’s south, I think, so south-facing so you’re getting the sun all day. And just over there, so over to my left, screen’s right is Luštica, and then beyond Luštica you’ve got the open sea. Anybody who loves sailing and they want to get out into the open sea, this can be fantastic because you can have your little tender outside, your yacht in the Marina, get out into the open sea and have a great time, or into the bay. And the bay is phenomenal. It’s a great place to have a boat.

LADISLAS MAURICE: And typically, Herceg Novi comes at a, what, 30% discount to Kotor Bay, roughly?

PETER: Yeah, at least 30%, it’s a good analysis.

LADISLAS MAURICE: 30%, 40%? 30%?

PETER: Yeah.

LADISLAS MAURICE: Yeah, cool. And we are five minutes away from Croatia.

PETER: Yeah. Yeah, it’s just over the border. I know it’s not something that will appeal to Ladislas. But on the chances that Montenegro gets European Union accession, then I think the prices here, I would say they’d probably jump up 50% quite easily. That’s quite an easy thing. Quite often the countries that had accession to the European Union in the past, they doubled in prices. The talk of Montenegro being the next to access into the European Union means that the prices have risen slightly anyway, and it’s been quite a hot market the last couple of years. I think a 50% for Herceg Novi is quite doable.

LADISLAS MAURICE: It would make a big difference definitely for especially Herceg Novi. And then the Dubrovnik Airport is, what, like 30, 40 minutes away?

PETER: Thirty, forty minutes away, yeah, yeah.

LADISLAS MAURICE: The main airport here is not Tivat Airport, it’s not Podgorica Airport, it’s Dubrovnik Airport, which is actually quite large.

PETER: Yeah, it’s quite a decent-sized international airport. And I think that you’re either equidistant to the airport as Dubrovnik is or even closer to Dubrovnik Airport than Dubrovnik is from this area.

LADISLAS MAURICE: Yeah. Cool. Now let’s go into the actual numbers. So 620 square meters. What is the gross buildable area?

PETER: It’s 8% gross build area, which is 4 square meters short of 500 square meters.

LADISLAS MAURICE: Okay, so about 500 square meters. Great. What are the construction costs, roughly, if you do something that is not just mid but a bit premium?

PETER: Yeah. I think this site would actually warrant it, and also you’d sell this at a premium as well. I would say you should budget around about €1,200 per square meter for term as a lux kind of quality, that type of quality.

LADISLAS MAURICE: Cool. Because you showed us some buildings before we came here, where the qualities was a bit more mid. How much would have that been per square meter?

PETER: I think those developers probably spent about €800 per square meter. Actually, I was quite impressed, they had nice double glazing in there. I think this property would just suit a very simple form, white render, black windows, something like that, either as a single dwelling, like, contemporary house or for, like I mentioned, six apartments, something like that, it can be really cool.

LADISLAS MAURICE: Cool. Okay, so €1,200. And what’s important to note is that because we’re so close to Bosnia, here, we can benefit from working with Bosnians, which is a lot more affordable. Whilst the plot of land we saw in Luštica a bit earlier, there typically construction is a bit more expensive because it’s a bit more remote. There, there’s a premium. Here, construction comes at a discount. Just the little nuances of construction in Montenegro. In terms of total project size, we’d be looking at €600,000 to essentially build the structure. Looking at a coefficient of 85% of livable space and about 15% for common areas, it would be about 420 square meters, which is you’re saying six apartments of about 70 square meters each.

PETER: Yeah, yeah.

LADISLAS MAURICE: And you were recommending that the two apartments on the top floor be a bit different, right?

PETER: Yeah. Just to go back a little bit just to give people an idea of what they would get in 70 square meters, in 70 square meters, you’d get reasonably generous, not American generous but kind of European generous, two bedrooms, two bathrooms, and two balconies. I know that because we live in a 70 square meters, which has exactly those dimensions. And then on the penthouse, the penthouse could be phenomenal. You could actually sell two penthouse apartments. You’d sell those at a premium. And if you do it with a flat roof design, you’re then also going to allow the people with the penthouse to have the exclusive right to use that rooftop. You will then be kind of selling or including the terraces.

You’re going to have 70, 80 square meters of additional terraces on top of that, where you would actually put maybe a big pergola, outdoor kitchen, perhaps a Jacuzzi. And you’re going to be a little bit higher up, of course, and you’re going to have proper panoramic 360 degree views or whatever. Before, I mentioned Luštica, open sea, Tivat, Portonovi, Lovćen Mountain, and then you’re going to be looking at over the kind of border for Croatia.

LADISLAS MAURICE: And this would be the worst view?

PETER: This is the worst view, yeah.

LADISLAS MAURICE: Right, because this would be the ground floor, because underneath is where you would have the parking for cars.

PETER: Yeah.

LADISLAS MAURICE: So imagine, add, like, three, four floors to this, imagine the views from there. You would see literally everything. It’d be quite stunning.

PETER: Yeah, yeah.

LADISLAS MAURICE: In terms of selling prices, the normal apartments versus the penthouses, how much per square meter?

PETER: I think, very conservatively, you’d be looking at €3,000 per square meter, so €210,000. I think that price is almost, when I say it, I think it’s a little bit low for the location and the quality.


PETER: Just to be very conservative, so let’s say 3,000 square meters, so €210,000 for the 70 square meter apartments. And then for the penthouses, then I think you should be looking at maybe €3,500 to €4,000. Realistically, I think you should be selling the four apartments maybe €3,000 to €3,500. I think that’s a reasonable price in today’s money. And then the apartments above maybe €3,500 to perhaps even €4,500 a square meter, considering that you will also be giving them the terraces as well.

LADISLAS MAURICE: Yeah. If we use €3,000 for the normal apartments and €4,000 for the penthouses, this gives us about €1.4 million on a cost basis of €600,000 for construction plus €300,000 for the plot of land, so €900k total, about 56% gross profit. These are just very rough numbers because, obviously, it’ll cost a bit more because you need to destroy the structure. You probably want to add a pool, a nice pool like the neighbors did, but nicer, potentially. All these things would increase the price. When he’s saying €3,000, if you add a big swimming pool here, then you go to €3,200, €3,300, etc. Potentially, you could have individual pontoons for the penthouses for boats, potentially add a little bar.

PETER: The world’s your oyster, yeah.

LADISLAS MAURICE: Essentially, it would be more than €900,000, you’d be maybe looking at €1 million, but you’d be selling for more than €1.4 million. But essentially, the gross margin, you’re looking at least 56%. I feel quite comfortable saying this.

PETER: And also I think we touched on it when we were looking at the other plot this morning, I think that this could also suit the type of investor who doesn’t necessarily want to sell. They could actually build themselves a future income, pension, whatever it may be. If they want to put in €900,000, a million euros, then they’ve got their six apartments which they can then rent out long-term, or put it on Airbnb, they’ve got a fantastic income for the rest of their life, and they don’t need to worry. And they could live in one of the penthouses and rent out the other five.

LADISLAS MAURICE: Yeah, or just sell a few and then keep one of the penthouses, come out with a free penthouse and profit. Cool. Okay, fantastic. Look, two points. One, I wrote a whole article on the real estate market here in Montenegro, where to invest, where not to invest, etc., etc. There’s a link below. And secondly, if you want to invest in plots of land, or normal real estate, villas, whether for investment or for lifestyle, do get in touch with Peter Square Meter. What I really like about Peter Square Meter is he’s able to give realistic assessments of potential investments, and that’s always very helpful. We’ve done quite a few transactions together over the years that I’ve been active here in the Montenegrin real estate market.

PETER: That’s it, Ladislas. Don’t forget to like and subscribe. It helps with the algorithm.

LADISLAS MAURICE: I never say this in my videos but thank you, Peter Square Meter.

PETER: Yeah, you’re welcome.