The number of building permits issued in Q1 rose by 13.5% y/y and the growth rate accelerated from 12.7% y/y in Q4 2015, according to data from Monstat. In quarterly terms, the number of building permits fell by sharp 30.0% while base effects played a role in the annual increase. Some 116 building permits were granted to natural persons, while 52 building permits were issued to legal persons. The number of building permits to private persons rose by 19.6% on the year and that for corporations climbed by slower 2.0% y/y.
On the other hand, the approved building area shrank by 25.1% y/y 39,836 sqm, which highlights the uneven performance of construction sector and shows that most of the issued permits in the first three months of this year were likely related to small-scale projects. According to earlier data, the value of finalized construction works rose by 12.3% y/y in Q1 with the growth rate accelerating from 3.1% y/y in Q4. Large-scale projects will likely support construction activity in the near term, while investments in property are likely to be constrained by the Russian economic crisis as the Russians are key players on the Montenegrin real estate market.