In the first quarter of this year (January-March), only 117 permits and construction notifications were issued for building new apartments, marking the lowest number since the COVID-19 pandemic, according to Montenegro’s statistical office, Monstat.
This figure is significantly lower than the same period last year, when 398 apartments were approved, and the first quarter of 2023, with 502 apartments. Historically, such low numbers were seen only in early 2020 and 2021 during the pandemic. The record for permits issued was in the third quarter of 2017, with 1,508 apartments.
The decline continues a trend from last year, when 1,500 apartments were approved for construction, compared to 2,217 in 2023 and 2,156 in 2022. Despite this, the average price per square meter for new apartments rose to 2,161 EUR in the first quarter of 2025, nearly double the price three years ago.
Experts from the Chamber of Commerce’s Construction Committee explain that this drop reflects a slowdown in planned construction, not a complete withdrawal of investors. They cite a complex mix of factors, including recent macroeconomic changes, updated regulations reintroducing building permits (replacing prior simplified notifications), and the post-pandemic surge in projects catching up.
The committee stresses that the new legal requirements may temporarily reduce the number of formally registered projects, and a clearer picture will emerge after upcoming quarters.
Real estate market trends also show that foreign buyers have become dominant, purchasing properties worth 113.5 million EUR in the first quarter alone. Since early 2019, foreigners have bought Montenegrin real estate totaling two billion euros.
Industry insiders note that rising prices over recent years were driven mainly by foreign demand, particularly from Russians, Ukrainians, and Turks. Although demand has slowed, it still exists. Developers appear cautious, postponing new projects until current inventory sells, to avoid oversupply.
Additionally, data from the Central Bank of Montenegro reveals a strong increase in housing loans approved in early 2025—49 million EUR, up 88% compared to the same period last year. This surge may be linked to recent wage increases under government programs.
Overall, the construction sector faces a period of adjustment amid changing regulations and market dynamics, but complete investor withdrawal is not expected.
