Montenegro: An unspoilt paradise for pioneers

Trend-setting house-hunters are hot on the heels of the tourists now flocking to Montenegro. Zoë Dare Hall reports
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The Independent Online

Charles and Diana were about 25 years ahead of their time, if only in their choice of honeymoon destination. Montenegro, a country which may trigger few associations in your mind beyond a vague proximity to the troubled zone of former Yugoslavia, is now seeing tourism blossom again. And where tourists venture, the British second-home hunter is sure to follow.

Charles and Diana were about 25 years ahead of their time, if only in their choice of honeymoon destination. Montenegro, a country which may trigger few associations in your mind beyond a vague proximity to the troubled zone of former Yugoslavia, is now seeing tourism blossom again. And where tourists venture, the British second-home hunter is sure to follow.

Hot property spots in Eastern Europe are a bit like boy bands; it doesn't take long before a newer, prettier rival, if a little rough around the edges, steals the limelight. And Montenegro is that rugged newcomer. If you thought Croatia was cheap, Montenegrin property comes at a third of the price and it can only go up, especially now that Channel 4's A Place in the Sun has tipped it as one of the places where property will boom in 2005.

This former part of the Federal Republic of Yugoslavia, which actually went untouched by the 1990s civil war, is now a largely autonomous part of the union of Serbia and Montenegro. Surrounded by Serbia, Albania, Croatia and Bosnia and Herzegovina, this country of 650,000 people slips into the Adriatic Sea. If you swam due west, you'd hit southern Italy just around the Achilles' tendon.

The currency is the euro - and EU membership is being mooted for around 2011. The official language is Serbian, although English is widely spoken. And besides the honeymooning royals and celebrities including Claudia Schiffer and Sophia Loren who have discovered the charms of Sveti Stefan, a tiny outcrop devoted to one hotel, Montenegro's claim to fame comes from having the tallest population in Europe.

Unlike Croatia, Montenegro's coastline includes long, sandy beaches such as those around the Herceg Novi Riviera, an area popular with poets and painters. All the better to enjoy those 180 days of sunshine a year and average summer temperatures of 27 degrees.

Andrea Marston from Dream Property Montenegro says that most of her clients stumbled across the country having flown to Dubrovnik in Croatia, realised that prices were out of their league (a staggering €6,000/£4,100 per sq m on average) and headed for the Montenegrin border just 10 minutes away.

"The big tourist centre is Budvar, where we have our office, but a lot of people are buying in Kotor, a beautiful Venetian-style town surrounded by stunning fjords," says Marston. "Both of these old towns are like a mini Dubrovnik, but property in Montenegro is at least two-thirds cheaper."

New Skys has also ventured into Montenegro and its managing director Xavier Wiggins says it has seen greatest demand for property around the beautiful bay at Boka Kotorska, "because of its proximity to Dubrovnik and views to die for".

The south-western corner, near Croatia, is proving particularly attractive to British buyers. "It's so handy for Dubrovnik airport, with direct BA flights from the UK from the end of this month," says Marston, "but once you're in Montenegro it's completely unspoilt and rugged. It's so undeveloped that there are hardly any new properties. It's a place for people who want quaint old rustic properties."

So far, with such a new market, it has been hard to pin down a Montenegrin property-buying type, Marston comments. "I've just sold a studio flat in Petrovac for about £15,000 to a lady who was put off by the prices in Croatia. Another client is an interior decorator who wants something rural to do up as a holiday home and I have one retired couple who have chosen Montenegro instead of Spain because they want to avoid being surrounded by English people."

Wiggins's clients are mainly "either retired people or holiday-home hunters and they are interested in buying traditional stone cottages with a Venetian appearance". Such properties in Herceg Novi or Kotor cost from €80,000 (£54,000) or if you head inland you can buy a four-bedroom house from €70,000 (£48,000).

The nearby fjords are a big draw and the interior is exceptionally beautiful in an unkempt way, with such striking features as the world's deepest canyon after Arizona's rather more famous one, lakes, waterfalls and natural parks. "The interior is completely undiscovered and it's great for outdoor pursuits. It's a place that appeals to those who like the isolation of Croatian islands such as Hvar and Korcula," says Marston. "There are ski resorts with potential, too."

Simon Randall, a comedy act organiser from west London, has recently braved this new market. He has just bought a house in Budva for £80,000 through Dream Property Montenegro which, like most houses in the old walled town, has two storeys with a shop below. "It's partly to provide an alternative pension but there's also the fantasy that I'll move there when I retire and live off the proceeds from selling my London flat," Randall explains. "The man who sold us the house rents it from us and as a buy-to-let investment it has proved far more profitable and less problematic than it would to invest in buy-to-let in London."

Randall considers it a no-lose situation. "It's a poor country, a bit rough around the edges, but it's bound to change. It's going to become independent from Serbia soon and will eventually join the EU so prices will triple. Plus it's just a really beautiful place to have a house, bills are negligible and living costs are very cheap."

Marston warns prospective buyers: "It's all some way behind Bulgaria. There isn't quite the infrastructure there - there's less lighting and the water system can get overloaded - but it'll come in time and then prices will rise, I predict by about 30 per cent this year."

There are also the risks of stepping into the unknown. "It's a place for pioneers who want something unspoilt and don't mind taking a bit of a gamble," says Marston. "There have been cases of people finding that they've only bought part of a property because the vendor didn't own the whole thing, so getting a clear title is imperative. You must make sure your lawyer checks everything thoroughly and it's advisable to give them power of attorney to deal with everything in your absence."

You can't get a mortgage for a property in Montenegro and buying land is difficult or impossible for foreigners wanting undeveloped plots over 500sq m. But the house-buying process is quick and planning laws are flexible. "From putting down the reservation at the start to signing everything in the court and being handed the keys, it usually takes about three weeks," says Marston.

Who knows? This time next month you too could be part of that rare breed of foreign home-owner who knows more than just the basics about Montenegro.

Dream Property Montenegro (01753 831 182; www.dreammontenegro.com)

New Skys (0845 330 1449; www.newskys.co.uk)

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