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Montenegro, rental prices have increased by 30-50%, real estate prices by 40% – a problem for subtenants

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The real estate market is in a chaotic situation with abnormally high prices. Representatives of real estate agencies recently reported that rental prices have increased by 30 to 50%, while real estate prices have increased by 40%. The Revenue and Customs Administration (UPC) of Pobjeda announced that in the first 11 months, EUR 25.3 million in real estate sales tax was collected, which is EUR 7.3 million or 41% more than in the same period last year. Based on the tax on the income from the rental of real estate for the first 11 months, EUR 8.7 million was collected, which is EUR 4.5 million or 105% more than in the comparable period.

The Association of Subtenants recently announced that landlords do not pay taxes and the state loses millions annually because of this. They believe that this tax could be the basis for starting social housing and subsidies for the most vulnerable tenant families.

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The law stipulates that ten percent of income from real estate sales tax belongs to the state budget and equalization fund, and 80% to municipalities. This tax is collected by the Revenue and Customs Administration.

The most tax on real estate transactions was collected in Budva (six million or 49% more on an annual basis), in Podgorica 5.3 million (62% more), and in Bar 3.4 million (57% more). In fourth place is Herceg Novi with 3.1 million (100% more), followed by Kotor with 2.3 million (28% more), Tivat with 2.1 million (44% more), and Ulcinj, where a decrease in income was recorded from 39% to 677.9 thousand euros.

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That income in Nikšić fell by 59% to 466.8 thousand euros. 320.2 thousand were charged in Kolašin, 291.8 thousand in Danilovgrad, 256.7 thousand in Bijelo Polje, 182.3 thousand in Žabljak, 121.9 thousand in Cetinje, 113.6 thousand in Pljevlja, 107.3 thousand in Berane. Thousand, in Rozaje 100.7 thousand, in Tuzi 53.3 thousand, in Plav 50.6 thousand, in Andrijevica 27.7 thousand euros, in Gusinje 22.5 thousand, in Plužine 10.7 thousand, in Mojkovac 9.4 thousand, and in Petnjica 7.97 thousand euros. Šavnik had the lowest income on this basis of 5.8 thousand euros.

According to UPC data, a total of EUR 8.7 million was collected on the basis of real estate rental tax, which is 105 percent more than last year for 11 months, and this money belongs to the state budget.

UPC did not answer questions on how many real estates (houses and apartments) are subject to rental and sales tax, as well as whether that number has increased compared to last year.
– Regarding the data related to the number of real estate (houses and apartments) on which the sales and rental tax is paid, we inform you that we are unable to provide the same, because the data obtained from the competent regional units cannot be aggregated in an exact way – they said from UPC.

The real estate market, both In the sales and rental segments, currently records extremely high prices. Representatives of real estate agencies told Pobjeda that rental prices have increased by 30 to 50%, so some monthly rents reach up to EUR 2,000. Representatives of the agencies point out that one of the main “triggers” for the enormous increase in prices on the real estate market was the arrival of a large number of Ukrainians and Russians after the start of the war in Ukraine.

Pobjeda from the subtenant association Moj dom told Pobjeda that the drastically increased rent prices have made the life of tenants even more difficult to the extent that thousands of tenant families are dramatically threatened. They ask the Government to come up with a way to help subtenants through subsidies, as well as for the state in each municipality to allocate salaries for the start of social housing construction, local media says.

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