New Property Transfer Tax Rates in Montenegro

Montenegro introduced new progressive rates for property transfer tax, coming into effect on 1 January 2024, in the latest move that seems to have gone unnoticed by the press and the public. Unlike the current flat 3%, here are the new property transfer tax rates that will be applied:

• Property value up to €150,000: 3%;
• Property value from €150,001 to €500,000: fixed €4,500, plus 5% on the amount above €150.001;
• Property value above €500,001: fixed €22,000, plus 6% on the amount above €500,001.

Notably, the property tax burden is usually on the buyer’s side. So, if you are buying a property for €200,000, your transfer tax will be €7,000 (equals €4,500 plus €2,500 as 5% of the €50,000), or 3.5%. And if you decide to buy a high-end property worth €1 million, you’ll be punished with a transfer tax of 5.2%, or €52,000.

This will additionally increase property prices in the country, but Montenegro will remain a very attractive property market. Nevertheless, this move won’t bring anything good to both the buyers or the sellers.