How to Build a House in Montenegro: 12 Stage Guide (with Cost and Practical Advice)

In this article, we are going to share the details on how to build a house in Montenegro: where to start and what stages to complete to avoid mistakes and simplify the process. It is important to understand all the twists and turns to be sure that the invested funds will pay off.

A private residence by the warm sea is a dream that may come true for those who can afford to buy a property or invest in construction in Montenegro. If you can’t find a desirable ready-made house, you contemplate designing and building your own home. This is always a difficult task, whether it be a mansion for your family or an investment project for a short or long-term rent.

What are the advantages of building a house in Montenegro from scratch?

1. Confidence in the quality of construction. When the house is built before your eyes, you can control all the stages. 
2. Safety, including seismic. We don’t recommend you to save on the fittings.
3. Ability to choose the location of your plot and the place of the house on it.
4. Customization of your project depending on the needs of your family or investment plan.
5. With the reasonable approach, the construction can be cheaper than buying a ready-made property. 

Content

What to Consider When Building a House in Montenegro

Stages of House Construction

Stage 1. Selection of the Plot of Land

Stage 2. Selection of an Architectural Firm

Stage 3. Selection of a Construction Company

Stage 4. Buying a Plot of Land

Stage 5. Creating a Sketch Project

Stage 6. Approval of the Sketch Project

Stage 7. Creation of the Full Architectural Project

Stage 8. Creation of the Interior Design Project

Stage 9. Revision of the Complete Architectural Project

Stage 10. Obtaining a Construction Permit

Stage 11. Construction of the House

Stage 12. Procedure of Commissioning

Laws and Rules of Construction in Montenegro

What Do You Need to Legalize the Real Estate

How to Build a House: by Yourself or with a Construction Company?

Advice on Building a House in Montenegro

What to Consider When Building a House in Montenegro

Newcomers usually face three typical problems of the construction sector in Montenegro:

• Unprofessional developers. When you choose a contractor, pay attention to the experience of his work, the quantity and quality of the houses built in the country, adequacy of communication, as well as safety of the payment scheme. Don’t be charmed by the catchy advertising and assurance of the successful experience in other countries, because you will know the truth only during the construction of your property. We also don’t recommend relying on the advice from the real estate agencies and other affiliated persons, because they live off the interest from the income and have no sincere intentions to help.
• Stretching deadlines. In Montenegro, the procedure of obtaining the necessary permits can be quite complicated and time-consuming. It will be very difficult for a foreigner who doesn’t know the local language to go through the bureaucratic process on their own.   
• Fraud. Be careful and check who you prepay to.

Stages of House Construction

Before building a house in Montenegro, you should firstly find the right place, go through the purchase and approval procedures, choose contractors and so on. We have divided the process into stages to make it easier for you to navigate all the vicissitudes.     

Stage 1. Selection of the Plot of Land

It’s quite difficult to find an even plot of land in the mountainous country of Montenegro. There are many ways to improve sloping plots and make a beautiful view. However, there are places where no heavy machinery can climb, for example, because of the slope angle or the narrow road. This should be considered right away, otherwise the process can become more complicated and much more expensive.

• When selecting a plot of land, you should estimate the possibility of building a properly shaped house on it. 
• Before the purchase, check out the view, both from the plot and from different floors. You can examine the documentation on the neighboring plot in detail to make sure that the view from the window of your future residence will not be blocked by another building. 
• Pay attention to the soil. If heavy machinery has to crush the rock, the excavation work will raise the cost.
• Transport accessibility really matters. It is a common thing for Montenegro to have a road on the cadastral map, while there is actually no road out there. Besides, the local streets are so narrow that it will be a problem to pass around an oncoming car every time. 
• Check the possibility of connecting electricity and urban water supply. If you don’t have a connection to your plot (e.g., there’s only a district connection), you will either have to pull the pipes yourself or arrange water trucking. In addition, there’s no city sewerage system in some areas, so they use septic tanks. 
• The infrastructure of the district may be important for those who look for a school or a store nearby, as well as a hospital, sports facilities and a beach in the area.
• You should also consider the seasonal load, as the population density increases several times leading to traffic jams on the roads.
• As for the sea line and possible constructions near the house (terraces, bridges, show-offs, etc.), you should be aware that the coastal zone is under the jurisdiction of a separate organization called "Morsko Dobro". This is a public company that has been managing "the border line of the maritime territory" since 1992 with its headquarters in Budva. This excludes the possibility of transferring part of the coastal area from state to private ownership, and the individual right of use is exercised through the runtime license with "Morsko Dobro".
• If you plan to build a house in Montenegro for the resale purposes, pay attention to the investment attractiveness of the property.

At this stage, it is crucial to study the following documents:

1. Urban and Technical Conditions (UTC), which is available on the websites of public organizations (you need to know the cadastral number of the plot). UTC is made for each plot separately and can’t be changed. Sellers may trick you by showing only part of the document, but in fact it may contain some restrictions (for example, the area is under UNESCO protection, or there are limits on the architectural style or number of floors, as well as size or purpose of the property).

If the seller doesn’t provide the UTC, this is a red flag. In this case you have to request the document by yourself: write Zahtjev za UT uslove and submit it to the secretariat of the municipality where you plan to build a house, and pay a €50 fee. Your application should include information about the plot on which you’re going to place your building. Within 20 days, you will receive your individual UTC and will be able to study it with a lawyer or developers.

Useful links:

• UTC application sample
• Information on the cadastral plot
• Example of the UTC
• Geoportal of Montenegro — see the exact coordinates of the plot.

2. It is necessary to check the legal clarity of the plot using the List Nepokretnosti. You should check it for illegal constructions, restrictions or encumbrances (due to the will, etc.).

If the site has several owners, make sure that the person engaged in negotiations has the authority of all other owners. The List Nepokretnosti is freely available on the Internet. The original of this document can be obtained from the Civil Bureau at the cadastral office. It is issued to anyone who has submitted an application, paid the fee and provided a passport copy.

If there are any restrictions on the property, this will be indicated at the bottom of the document. Before signing the purchase and sale contract, you should check that the previous owner has resolved all disputes related to the plot. 

Use this link to check out and download the List Nepokretnosti.

Once you have chosen the plot, we recommend you to inspect it together with a representative of an architectural or a development company.

Stage 2. Selection of an Architectural Firm

What to look for when choosing an architectural company:

1. An architect with a local license (required for the project to be approved). Otherwise, the project will have to be adapted by another company having a license. Not every company will agree to sign someone else's documents. Check the license here.
2. Company profile (ask for portfolio) and its architectural style. 
3. Completed projects (if possible, take a look at them personally).   

Stage 3. Selection of a Construction Company

An architectural firm will likely recommend a construction company it used to work with. In this case, consider the following information:

1. license (check the license here);
2. profile (prevailing types of estate — private, commercial or public ones). It affects both communication with the client and the approach to work;
3. completed projects (if possible, take a look at them personally). 

Stage 4. Buying a Plot of Land

The purchase of real estate (a plot of land, a house) in Montenegro is a simple process, which is carried out by a notary, who certifies the documents. The payment amount to the notary depends on the cost of the purchase. The documents to get acquainted with before the purchase are listed above. In a nutshell, they include:

• Space-and-urban plan of the municipality,
• Urbanistic and Technical Conditions (UTC) for a plot (parcella),
• List Nepokretnosti,   
• In addition, you should check a Detailed Urbanistic Plan (DUP) in this region.

Stage 5. Creating a Sketch Project 

Idejno rješenje (conceptual design) is a full-fledged project with clearly regulated documentation on how your house will look. Based on the issued UTC (urban and technical conditions), the architectural company prepares Idejno rješenje for the property. Idejno rješenje defines the general concept of the construction (fitting the building into space, 3D of the property).

Idejno rješenje includes: 

• area of ​​the building;
• size of the building; 
• number of floors;
• height;
• description (division into residential and non-residential zones, layout of the site, layout concept for all floors, floor-by-floor sections of the building, materials of construction, structure, facade finishing, UTC, licenses, power supply permission, etc.).

This document is approved by the city architect's office and made in accordance with the UTC of a particular plot.

Lead-time of Idejno rješenje is 10-30 days.

Stage 6. Approval of the Sketch Project

Sketch project or Idejno rješenje is submitted in a digital version on a CD to the Office of the Chief State Architect or the Chief City Architect for approval.

To get Idejno rješenje on the construction of a building over 3000 m2 (gross) or a 4-5* hotel/tourist village, reach out to the Chief State Architect. Idejno rješenje for the property up to 3000 m2 is under the remit of the Chief City Architect.

An architectural company can also submit a set of documents for approval. If it is local and has been operating for a long time, there shouldn’t be any problems with approval. Unless they found any inconsistencies: for example, if the terrace is assigned to the living space. You may face such comments as: the windows are wider than required by the style. This is because the traditional Mediterranean house style implies tiled roofs, natural stone siding and small windows. However, professional architects may know how to get around such restrictions without harming the style of the building and the project itself.

Approval time is 15-45 days (if there are any amendments). As a result, you will get the document called "Saglasnost glavnog gradskog arhitekte".

• Example of the application
• Example of the approved document

Stage 7. Creation of the Full Architectural Project

Glavni projekat (full architectural project) should be made only after the sketch project is approved, otherwise you can waste money. The full architectural project defines all characteristics of the building with equipment and installations, as well as the development of all the details required for construction. We may say that glavni projekat works out the sketch project for the construction of the building. You may order a full project from the architectural company, provided that work on the main project starts only after the sketch is approved.

Glavni projekat includes:

• application for permits,
• parcellation plan of the plot (it’s important to indicate if the boundaries of the cadastral plot don’t coincide with the ones of the urban plot),  
• fire safety plan,
• conventional landscape project, 
• house design (complete working documentation with drawings, on the basis of which you can order materials),
• water supply and sanitation scheme,
• electric project,
• ventilation and other utility network project (optional), 
• estimate documentation (in detail).

Lead-time of Glavni projekat is 30-45 days.

Stage 8. Creation of the Interior Design Project

An interior design project implies zoning and arrangement of furniture and equipment with specific dimensions. This is an optional document in case you build a house for yourself and your family. At the same time, if you build a property for investment purposes in Montenegro, a design project is necessary.

Design project includes:

• Drawings of custom-made products,
• Specifications (with links to the products and prices), 
• A fully assembled interior, which is shown in the drawings and 3D review.

It’s not difficult to find an interior designer, just request a portfolio. 

Stage 9. Revision of the Complete Architectural Project 

To obtain a građevinsojk dozvole, it is necessary to make an audit of the complete architectural project. It is conducted by a commercial company licensed to audit project documentation and provide professional supervision. The auditor has to obtain the required permits issued for the technical documentation, a copy of the plan and the property deed for the plot on behalf of the investor, and to issue a written conclusion that the building can be constructed based on the complete architectural project. Time period for revision of the project documentation is 15-20 days. At the time of the audit, the investor has to pay for utilities (connection to utilities) for the property under construction.

Stage 10. Obtaining a Construction Permit

The application is submitted to Ministarstvo ekologije, prostornog planiranja i urbanizma - Direktorat za inspekcijiski nadzor i licence 15 days before the construction begins.

At the same time, you have to choose the supervisory authority and notify the Committee for Construction about it. The supervisory authority makes sure that the construction company adheres to the project.

You have to submit the following information to the committee:

• a positive decision from the audit organization,
• a license from a construction firm,
• a license from a supervisory authority.

The documents are submitted to the Construction Committee for indication purposes. You don’t have to wait for a response or permits, and 14 days later you can start construction. The permit is issued for 1 year.

You can view the issued construction permits on the website of the Government of Montenegro.

Stage 11. Construction of the House

On the day when you submit the application, you have to place građevinska tabla in accordance with the regulations prescribed in “Zakon o planiranju prostora i izgradnji objekata”, section 89 paragraph 5, and Montenegro Service Sheet No. 070/17 dated 27.10.2017.

Main stages of construction in Montenegro:

1. Groundworks.
2. Monolithic works.
3. Rough finishing works.
4. Roofing works.
5. Installation works (walls, interior partitions, rough plumbing).
6. Electrics and lighting.
7. Water supply and sewerage. 
8. Finishing works. 
9. Landscape works. 
10. Furniture equipment. 

Construction in Montenegro usually lasts for 9 months or longer (in case of a three-storey building from foundation to interior works).

You can request a temporary connection to the city water supply (based on the Građevi dosvola).

Stage 12. Procedure of Commissioning 

The procedure of commissioning for a constructed property is regulated by The Act on Spatial Planning and Construction (Zakon o planiranju prostora i izgradnji objekata).

You have to obtain upotrebna dozvola in the institution where you get a construction permit. 

Before you start using the house, you are obliged to submit an application for the property use. This has to be done no later than 7 days after the completion of the works. 

The investor should submit an application to obtain the permit. 

View the issued documents.

• Application of the construction contractor.
• Application of the supervising engineer.
• Application of the lead designer.

These 3 documents are issued to indicate that the building is constructed in accordance with the construction permit and full architectural project. 

In addition, you have to provide a confirmation that you have paid all the fees and attach the approved full architectural project.

After all works on the construction site are completed, as stipulated by the hradzevinska dozvola, the property has to pass the technical inspection. 

Only after receiving this document, you will be allowed to add the property to the cadastral registry and obtain the List Nepokretnosti.

To get the address, you have to submit an application to the Cadastral register of the municipality where the house is built. For the Cadastral register to issue a Decision on the number of the building, it is required to submit an upotrebna dozvola and an elaborat of geodetic works. The elaborat is ordered from a geodetic company. The geometrician goes to the site and makes the necessary measurements. Within 7 days the Cadastral register should issue a decision and assign the address to the constructed property. Afterwards, it’s added to the Montenegrin Real Estate Cadastre.

Don't forget to sign a contract with the electricity provider and submit an application to the Water and Sewerage Service of your municipality (Budva Vodovod i Kanalizacija). You also have to attach the hradzevinska dozvola and the project izvod for water supply installations (or the List Nepokretnosti, if you have already obtained it). In general, the commissioning period is 2-3 months.

The Law about the water supply: Zakon o regionalnom vodosnabdijevanju crnogorskog primorja.

Laws and Rules of Construction in Montenegro

Non-residents are allowed to buy land plots in Montenegro according to the Law on Foreigners of 2009.

• Construction rules in Montenegro are regulated mainly by the Law on Space Planning and Property Construction (Zakon o planiranju prostora i izgradnji objekata). 
• There are regulations that are prescribed in the Detailed Urbanization Plan (DUP). This plan regulates the height of buildings, the construction ratio, the maximum allowable area, the style of construction and so on. You should take into account that some places haven’t passed DUP yet. You should check it before buying a plot. A non-resident cannot register a plot of land beyond 5000 m2 that doesn’t have a DUP.
• The rules of construction in Montenegro also imply registration of the constructed property according to the Law on State Survey and Real Estate Register (Zakon o državnom premeru i katastru nepokretnosti). It includes requirements for technical documentation and geodetic works, boundaries of the property and Elaborats, cadastral classification of land, approval of land rights as well as real estate documents (List Nepokretnosti, etc.). 

What Do You Need to Legalize the Real Estate

We don’t recommend engaging in illegal construction. It has been a common thing in Montenegro for many years, but now the control over this sector has been tightened. 

In 2016 Montenegro implemented The Law on Regulation of the Illegal Property (Zakon o regularizaciji neformalnih objekta). According to this law, an illegally built house can be legalized if you collect a set of necessary documents and pay the utility connection tax. The amount of tax depends on the municipality, e.g. in Budva it is €300 per square meter, while in Bar it is much cheaper. 

There are many illegally constructed buildings on the legal estate market, which can be sold and bought (even hotels). It is no big deal for Montenegrins, but it can be quite risky for a foreigner. Some buildings can’t be legalized. You may live in the illegal property for many years, and it will even be connected to water and electricity, but it will be labeled as “Nema dozvolu” in the List Nepokretnosti. In this case, the problems may arise when you try to sell this house, as the potential customer will refuse to buy the illegal property. Moreover, you won’t be allowed to legalize it.

What if there is an illegal building on a plot that you plan to buy?

Firstly, let's clarify what “illegal” means.

• This may mean that this building is absent in the cadastral documents. In other words, it was built without a project and didn’t get the above-mentioned approvals and permits. 
• This may mean that the property has been built according to all the rules, but later terraces, garages, guest houses, etc. were added to it. Thus, it has become illegal because all these additions were made without a project and its approval. If these additions encroach on the neighboring plots and violate other norms, it will be possible to legalize the building only after you eliminate these shortcomings. 

Is the construction on the plot legal? You can check it on the geoportal and (List Nepokretnosti).

If the seller of the plot assures you that the property can be easily legalized, offer him to undertake it. It will take additional time and costs, but the purchase will be completely legal. It should be noted that if the DUP has not been passed in this area, the construction on the plot could not be legal. However, if the DUP is currently accepted, you may apply for legalization.

How to go through the legalization process? 

1. Submit an application for legalization at the municipality.
2. Attach the List Nepokretnosti. 
3. Order an elaborat from a licensed geodetic company (three copies).
4. Request a copy of the cadastral plan from the Cadastre register.
5. Pay the fees.
6. Obtain a seismic safety certificate.
7. Attach an architectural project from a licensed company (except for the property that is used as a primary place of residence).

The Law on the legalization of the illegal property. 

If you are a big investor and want to buy a non-authorized plot of land, you can self-finance the customized construction project and obtain a Decision on location. It will contain the detailed information on the house you’re going to build on the plot. The procedure is quite difficult: the municipality will tender for architects and surveyors, who will draw up the plan.

How to Build a House: by Yourself or with a Construction Company?

Is it possible to do the construction works by your own efforts?

• For these purposes, you have to order a draft and full architectural project and go through all above-mentioned approvals.
• The builders you hire should have a work permit, as private construction is prohibited. It means that they have to either be private entrepreneurs or work for a construction company. So, we may conclude that finding an architectural and construction company with a good reputation is the best option when it comes to construction in Montenegro.

Inspections by supervisors at the construction site is a common thing. Sometimes they are initiated by disgruntled neighbors.

How much is it to build a house in Montenegro? 

• On the seaside, a plot of land can cost from €100 per square meter. The farther it is from the sea, the cheaper. You can buy plots even at €20 per square meter, but they usually have a lot of disadvantages (no water supply, electricity, etc.).
• Mandatory tax on the purchase of real estate is 3% of the contract value. Notary services should be paid extra.
• The approximate cost of a draft and full architectural project is €25-20 per square meter.
• Preparation of permits and approvals for the construction of the building will cost at least €5000.
• There is a utility connection fee.

At the time of the revision, the investor has to pay utilities (for connection to public utilities) for the property under construction.

The 4-5* Hotels under construction are exempted from paying utilities, as well as those under reconstruction or demolition. This is also applicable to the construction of a new building in the existing size, if no additional utilities are required for the plot.

The municipality can significantly reduce the cost of utilities in some cases, even up to 80% in case of demolition of the building and construction of a new one in the existing size, if additional utility equipment of the land plot is required. 30% reduction is granted in case of a one-time payment.

The utility equipment fee for the land plots for development is determined depending on the infrastructure of the site, average cost of equipment, area, type of property and investor's involvement in the utilities. The fee is defined by the municipality within 15 days. The approximate amount of the utility fee is €100-180 per square meter.

Construction and finishing works will cost €700-900 per square meter if you arrange construction by yourself.

Advice on Building a House in Montenegro

Before deciding to build a house in Montenegro, you should be aware of all aspects and stages to avoid mistakes during construction. 

Pay attention to the following features:

1. Before choosing a plot of land, check its legal cleanliness with a lawyer, assess the site with architects or builders, examine the planning documents on the website of the municipality. 
2. When buying a land, check it for the illegal buildings and correspondence of the cadastral boundaries to reality. We recommend entrusting the corrections of the documents to the landowner before he sells you the plot.
3. When choosing the architectural and construction companies, check their reputation and completed projects, don’t violate the DUP and UTC regulations, don’t save on the necessary building materials and control the construction process personally. 

To ensure that the process of construction goes smoothly and without violations, leave it to the professionals, such as a full-service construction company AdriaticPoint. And, of course, pay all the fees on time.