**Property Rental in Montenegro 2025 – Long-Term vs. Short-Term: A Complete Investor’s Guide**

The Property Rental Market in Montenegro has been evolving rapidly for more than a decade. The influx of tourists, growing foreign real estate investment and dynamic regulatory changes mean that both long-term rentals and short-term rentals have their own unique advantages, challenges and place within investment strategies – both for local property owners and foreigners. As experts with many years of experience, we present an in-depth comparison, supported by available sources, of both rental models in Montenegro for 2025.

1. Overview of the Rental Market – Statistics and Trends

According to data from the Statistical Office of Montenegro (MONSTAT):

In 2024, the country welcomed 2.6 million tourists, with the majority choosing short-term rental apartments as their primary form of accommodation.

In coastal cities (Budva, Kotor, Bar), the number of seasonal rental properties has been steadily increasing alongside the growth of tourism.

The long-term apartment rental sector is also growing steadily, particularly in Podgorica, Tivat and business districts. The continued migration of foreign residents, seasonal workers and expats maintains stable demand for year-round housing.

The Ministry of Finance of Montenegro continues to formalize rental regulations, introducing new rules regarding rental registration and rental taxation while raising standards for rental services.

2. Short-Term Rentals in Montenegro – Advantages, Risks and Formalities

2.1 Investment Potential

In tourist destinations, short-term rental rates (May–October) can range from €50 to €150 per night for premium apartments, depending on location and standard.

During the peak tourist season, occupancy can exceed 80–90%, while monthly rental income can significantly exceed long-term rental rates.

2.2 Management Flexibility

The property owner can use the apartment freely outside the season, manage the rental calendar independently and control the pricing policy.

There is also the possibility of adapting the offer to market trends (weekend rentals, weekly rentals and rentals for events).

2.3 Challenges and Operating Costs

Higher initial costs: the property needs to be equipped with tourist amenities, air conditioning, internet access and a cleaning system.

Guest expectations: continuously increasing expectations regarding quality, cleanliness and safety.

Intensive management: frequent guest turnover, intensive communication, ongoing repairs and frequent cooperation with cleaning companies.

2.4 Taxes and Legal Obligations

According to the current tax legislation in Montenegro:

Rental income is taxed at a rate of 15% after deductions, with a 30% standard deduction for expenses available without the need for supporting documentation.

Rental activity registration is required with the relevant authorities.

Guest records must be maintained in accordance with tourism regulations.

Consulting a local tax advisor is recommended to ensure full compliance with applicable regulations.

👉 More information about property purchase taxes in Montenegro can be found in our other article: Property Purchase Taxes in Montenegro 2025 – Complete Tax Guide

3. Long-Term Rentals – Advantages, Risks and Formalities

3.1 Financial Stability

Long-term apartment rentals provide reliable, regular income: a typical rental rate in larger cities for one- and two-bedroom apartments ranges from €250–€500 per month, while in prestigious locations it can reach up to €800 per month.

Long-term rental agreements are usually concluded for periods of 12–24 months, giving the owner a long-term perspective of regular property income.

There is lower exposure to seasonal fluctuations and predictable, timely payments.

3.2 Lower Management Costs

After signing the rental agreement, contact with the tenant is less frequent and the scope of repairs and responsibilities is more predictable.

Security deposit (usually 1–2 months’ rent) and insurance can help cover potential losses.

Administrative costs are spread over the entire duration of the agreement.

3.3 Tax Aspects

Tax on long-term rental income ranges from 9–15%, depending on the level of income and the owner’s tax status.

There is an obligation to register the rental agreement with the local tax authority.

A written agreement is recommended, providing security for both parties.

3.4 Potential Risks

Lower potential return on investment – typical ROI is 4–6% annually in cities.

Potential difficulties in dealing with a problematic tenant.

Limited flexibility to change the rental rate during the term of the agreement.

4. Comparison of Practical Rental Aspects

5. Current Legal Regulations – What Should You Know in 2025?

The Ministry of Finance of Montenegro and local authorities are systematically introducing new regulations aimed at:

• Formalizing the property rental market
• Raising standards for tourism services
• Increasing tax transparency
• Protecting the rights of tenants and property owners

It is recommended to regularly monitor official announcements on the websites of MONSTAT (monstat.org), the Ministry of Finance and local authorities.

6. Which Rental Model Should You Choose? Expert Recommendations

Based on our experience, the choice of rental model should depend on:

• Property location (city center vs. tourist resort)
• Investor preferences (flexibility vs. stability)
• Willingness to undertake greater operational activity
• Acceptance of legal and tax regulations

Optimal strategy for 2025:

Large cities (Podgorica, Nikšić, Pljevlja) – long-term rentals provide stability and predictable property income.

Tourist destinations (Budva, Kotor, Herceg Novi) – short-term rentals can generate higher ROI, but require professional management and knowledge of applicable regulations.

7. Practical Advice for Investors

For short-term rentals:

• Check the registration requirements in the relevant municipality
• Ensure high-quality services and furnishings
• Provide professional guest services
• Monitor competitive rates in the region

For long-term rentals:

• Carefully select tenants – check references
• Sign a written agreement with clear terms
• Establish clear rules regarding the security deposit
• Regularly monitor the local rental market

Tax considerations:

• Maintain tax transparency and make regular tax filings
• Consult a local tax advisor
• Maintain documentation in accordance with legal requirements
• Monitor changes in tax regulations

Summary

Both property rental models in Montenegro have their place and can provide benefits for investors – provided they are managed consciously, in accordance with the law and market trends.

Real estate investment in Montenegro in 2025 offers attractive opportunities in both the long-term rental apartment segment and the tourist apartment segment.

The choice of rental strategy should be tailored to individual investment objectives, the amount of time available for management and local market conditions.

Official sources:

• MONSTAT – Statistical Office of Montenegro (monstat.org)
• Ministry of Finance of Montenegro (gov.me)
• Local tax laws and tourism regulations
• Real estate market reports and industry analyses

Every investment is a journey – full of questions, emotions and decisions. Choosing Montenegro is not only about numbers and indicators, but also about choosing a lifestyle and a place that delights you every day.

Considering investing in real estate in Montenegro?

Our team of experts can help you choose the ideal investment property and develop an optimal rental strategy. Contact us today to learn more about current apartment and property offers in the best locations in Montenegro!