Housing insecurity and market shifts in the Balkans

Housing challenges in the Balkans continue to manifest through both immediate humanitarian crises and systemic market issues. In Bosnia and Herzegovina and Montenegro, vulnerable populations, including Roma families, face extreme poverty and imminent homelessness, with some families living in dilapidated conditions without running water.

In Bosnia and Herzegovina, broader structural issues affect housing availability. A significant portion of the rental market operates within the ‘grey economy’, which complicates government efforts to provide rent subsidies for youth. Factors such as unoccupied properties owned by the diaspora and the rise of short-term rentals contribute to a disconnect between the total housing stock and the actual availability of homes for families. In Sarajevo, this creates a ‘leaky bucket’ effect for long-term residents.

Recent regulatory and economic shifts are further impacting regional real estate. In Montenegro, new visa requirements for citizens of Russia, Turkey, Belarus, China, and Saudi Arabia, effective November 2026, are expected to affect the coastal property market. Experts have noted stagnation in areas such as Budva and Kotor, where some older property prices have reportedly fallen by 15 to 20 percent.

In Bosnia and Herzegovina, experts predict steady annual price increases of 3 to 7 percent driven by high demand and inflation. While nominal wages have risen significantly since 2020, inflation has eroded more than half of these gains, reducing actual purchasing power and squeezing citizens amidst rising living costs.