Jewel that thrilled Byron and Bond
The little Balkan state of Montenegro is increasingly popular now it has severed its ties with Serbia and represents a tempting investment opportunity, says Nik Pollinger
Jasna, a property saleswoman in Montenegro, is still puzzled by her first British customer’s reaction to learning more about his prospective neighbours: “The house was perfect for him, and I happened to mention that his countrymen had already bought in the village. Russian buyers would find that appealing.”
Alas for Jasna, instead of closing the deal, her revelation cost it. It also challenged her otherwise solid grasp of the British psyche: “I haven’t volunteered this information since,” she says, wryly. But with British buyers arriving in this Balkan state in increasing numbers, even she will find it impossible to conceal their presence from one another.
A former English teacher, Jasna’s change of job is typical of that made by many Montenegrins who have something to offer the booming property and tourism industries. The first stop in Montenegro for many visitors flying into Dubrovnik, just across the border in Croatia, is Boka Kotorska, the Gulf of Kotor. The area has become a magnet for Montenegrins seeking to earn more than the current average income of £2,000 per year.
It is not hard to see why the area has also been a magnet for the British: Lord Byron was one of many visitors taken by its spectacular scenery and gushed: “At the moment of birth of our planet, the most beautiful meeting of land and sea was on the Montenegrin coast.” Many of the cream stone buildings he would have seen clustered in villages at the junction of rugged grey-green mountains and calm turquoise seas are now attracting the most attention from buyers. Particularly prized are the substantial, Venetian-era “captains’ houses” right on the shoreline.
Catherine ZetaJones is one of the famous names who have joined the latest wave of house-hunters in Boka Kotorska. More adventurous types arrived before the country became independent from Serbia last May, and many of these have seen their purchases appreciate considerably since.
Neighbouring Croatia, which has much in common with Montenegro, indicates where the market might go. In Dubrovnik prices have reached about €5,500 (£3,875) per square metre, whereas similar properties in Kotor, its smaller Montenegrin equivalent, can now reach more than €3,000, (£2,110), up from €2,000 a year ago.
Old Kotor, an archetypal, walled Mediterranean town which is now ushering acquisitive interlopers past its fortifications, has seen some of the fastest growth in valuations, despite being somewhat dark and noisy. Laura McCoy, from Macclesfield, bought three floors of a converted townhouse in its winding back alleys when on a temporary assignment as an estate agent this year. She has almost finished renovating and adapting them into two one-bedroom apartments of 23sqm and 50sqm, keeping original features such as exposed timber beams: “My first priorities were to make better use of the space — and to find decent builders,” she says.
Ms McCoy, who paid €115,000 (£81,000) and spent €60,000 (£42,250) on renovations, intends to sell the larger apartment for €190,000 (£133,800) at the end of the year. She may rent out the smaller apartment for €150-200 per month to a local or make €50-60 per night renting to holidaymakers in high season.
Rental demand is predicted to remain high: Montenegro is rated as the world’s fastest growing tourist destination but still lacks quality accommodation. Its appeal is bound to grow further if, as is rumoured, a budget airline opens a route to nearby Tivat soon. And now James Bond is visiting Montenegro in his next film, Casino Royale, the country’s cachet is sure to increase.
Steve Tattershall, from Dorset, first dipped his toe into Montenegro’s warm Adriatic water in September, 2005. He has since owned three apartments in the Boka Kotorska area and is now considering moving there with his wife and two children to identify land and develop property. His advice is: “Get involved now, before it’s too late. We have invested in Estonia, Morocco and Bulgaria but Montenegro beats them all for returns and atmosphere. I was doing research on the internet and saw some amazing apartments on the water’s edge. Breaking every rule in the book, I put down the standard 10 per cent deposit for my favourite before even having flown out to see it. The deal was completed a day after we arrived because you’re on a level playing field with the locals. Even better, there’s no capital gains tax on a sale.”
In just nine months, the value of Tattershall’s apartment in Stoliv had soared from €72,000 (£50,700) to €106,000 (£74,650) when he sold it in June. To get the best deal, he suggests putting in a reasonably low offer at the start: local sellers are likely to find even a low figure attractive, given their low incomes. And, when it comes to choosing between bidders, they often prefer to go on personal chemistry rather than the size of the offer.
The area’s particular attraction for him is the fact that its geography puts a natural limit on expansion, which is reinforced
Many happy returns: Perast, on the Gulf of Kotor, above, is as pretty as they come but lacks quality accommodation; Laura McCoy, right, bought a townhouse in Kotor