Montenegro rising

Montenegro, the Balkan nation that gained independence in 2006, has become a holiday-home heavyweight in the high-end property market. It’s not hard to see why. The country’s rugged, mountainous interior includes five national parks – just the place to try white-water rafting or to spot a golden eagle. But it is Montenegro’s 180-mile Adriatic coastline, directly below that of Croatia, and the beauty of Boka Bay and its emerald waters in particular, that have fired up international house-hunters. The fortified town of Kotor, a Unesco world heritage site, only adds to the scenic drama.

Award-winning marinas and five-star hotels have moved into Boka Bay in three significant residential waterfront developments: Porto Montenegro, Lustica Bay and Portonovi. Together, this trio is even greater than the sum of its parts, says Kieran Kelleher of Savills associates Dream Estates Montenegro.

“These three residential resorts, all close together and with marinas and extensive facilities, each has its own personality that appeals to different clientele,” says Kelleher. “They’re not directly competing but instead work together to promote Boka Bay as an exciting lifestyle destination in an easily accessible part of Europe.”

Porto Montenegro was the pioneer, taking a disused naval facility and transforming it into a glamorous 450-berth marina with an elite hotel, the Regent, and more than 70 designer boutiques and restaurants. In 2017, it was the world’s first marina to win the prestigious Yacht Harbour Association’s platinum award for excellence, and its collection of modern facilities rivals any of the Mediterranean’s more established spots. Since opening in 2009, Porto Montenegro can justifiably claim to have been the anchor for Boka Bay’s international fame.

“Porto Montenegro has established itself well, positioning the resort as the pinnacle of luxury. It’s the place to see and be seen, with high-end shopping, glitzy nightlife and the Buddha-Bar Beach club,” says Kelleher. “Typical property buyers there are younger and come from a very wide global reach.”

Porto Montenegro leads on property prices, too, typically starting from €10,000 a square metre, compared with €7,000 in Lustica Bay and €9,000 in Portonovi. Demand for homes has far exceeded supply, which means that Porto Montenegro’s latest development, Synchro Yards – priced at €20,000-plus a square metre – will test the market.

“This is a big moment for Montenegro,” says Kelleher. “All three resorts around Boka Bay are still in their teenage years. The new price point at Synchro Yards is a big jump, one that takes Porto Montenegro to the level of long-established international resorts.”

Synchro Yards has theatre and gallery space – a plus for the creative arts community – and two residential buildings: IVO Residences offers 25 apartments within a Rare Finds hotel, priced from €1.26 million; AERIS, styled like an ocean-going yacht and built over the water, has 22 one- to four-bedroom homes priced from €1.89 million.

Lustica Bay is the largest of the three resorts at 700 hectares, with coastlines on both the bay and the Adriatic, and the region’s first championship golf course. Its long-term plans include developing only 10 per cent of the land to add two marinas, five hotels and 2,000 homes, with extensive shops and sports facilities to attract families and year-round residents. The Peaks, Lustica’s latest, has apartments, townhouses and villas from €738,000.

Portonovi, like Lustica Bay, saw record sales in 2023. Homes here are handsome and larger than average, keeping capital values relatively high and rental yields low. Top of the range are 10 One&Only villas, each priced from €10 million.

“In all three resorts, prices have never fallen,” says Kelleher. “The new price points mean that pure investors, who saw substantial short-term capital increases, may no longer be coming, but we still see user-investors – owners who come to enjoy their home and also want a moderate return from rentals, with the hope of capital gains over the medium to long term.” The future looks bright for Boka Bay.

Pictures from top: Perast town (Alamy); a view of Kotor Bay (Alamy); sail boats on the water in Porto Montenegro (Alamy); St George Island (Alamy); and the view from the top of the Old Kotor fort (unsplash)