The real estate market in Montenegro is entering a new phase that will make it safer, more transparent, and more professional, thanks to the new Real Estate Brokerage Law. The aim of this law is to raise standards in the real estate sector, provide additional protection for clients, and create fairer conditions for licensed intermediaries.
Key Changes Introduced by the Law:
- Mandatory Licensing and Training for Agents
Real estate brokers will be required to pass professional exams and obtain a license, which will significantly improve professionalism and service standards in the sector. - Register of Authorized Brokers
A public register of licensed agencies will be established, enabling clients to easily verify if they are working with legal and licensed brokers. This step enhances transparency and trust in brokerage services. - Combating the Gray Economy
The new law effectively addresses illegal brokerage, reducing the number of unauthorized intermediaries and protecting clients’ rights. This creates a fairer environment for all market participants. - Escrow Accounts for Agencies
Financial transactions during the process of property purchase or sale can now be handled through special escrow accounts maintained by agencies. This provides additional financial security for both clients and agencies. - Damage Insurance Policy
Agencies will be required to have insurance that covers potential errors or damages incurred during brokerage. This is another measure that further protects clients. - Transparent Commissions
While commission rates remain a matter of free-market negotiation, the law introduces clearer definitions of commissions and mandates the signing of brokerage contracts with sellers, creating a more transparent business framework in the real estate market.
Penalties for Illegal Brokerage
The law sets clear penalties for those involved in unlicensed brokerage. Individuals engaging in illegal activities can be fined up to €2,000, while legal entities face fines of up to €20,000.
Benefits for Clients and Brokers
For Clients:
The law provides better protection, reduces the risk of fraud, and ensures more professional service.
For Licensed Brokers:
It creates fair competition, improves business conditions, and strengthens the reputation of agencies.
Conclusion
With the adoption of this law, Montenegro’s real estate market becomes safer and more transparent, further contributing to the sector’s development and boosting trust in Montenegro as an attractive investment destination. These are crucial steps toward modernizing the real estate market, ensuring better protection for all participants, and making operations more efficient and professional.
